Back in June 24, the EURUSD looked overbought around 1.1400 facing a confluence of supply levels.
Thus, a bearish movement was initiated towards 1.1275 followed by a deeper bearish decline towards 1.1235 (the lower limit of the newly-established bullish channel) which failed to provide enough bullish support for the EUR/USD.
In the period between 8 - 22 July, sideway consolidation range was established between 1.1200 - 1.1275 until a double-top reversal pattern was demonstrated around the upper limit.
Recent Bearish breakdown of the pattern neckline confirmed the short-term trend reversal into bearish towards 1.1175.
Fortunately, evident bearish momentum (bearish engulfing H4 candlestick) could bring the EURUSD back below 1.1235 which stands as an Intraday Supply zone to be watched for Intraday SELL entries upon any upcoming bullish pullback.
HOWEVER, Early bearish breakdown below 1.1175 facilitated further bearish decline towards 1.1115 (Previous Weekly Low) where evident bullish rejection was recently demonstrated on July 25.
That's why, Intraday bullish pullback was demonstrated towards 1.1175-1.1200 where a valid SELL entry was suggested in a previous article. It's already running in profits.
This week, bearish persistence below 1.1115 was mandatory to allow further bearish decline initially towards 1.1025.
However, the EUR/USD pair failed to establish a successful breakdown below 1.1115. Instead, a short-term bullish double-bottom pattern was established around 1.1115 (Weekly Low).
The EUR/USD remains trapped between the depicted zones (1.1115-1.1175) where a bullish pullback towards 1.1175 should be expected in the near future.
Conservative traders should look for a bullish Head & Shoulders pattern being demonstrated around the current price levels as an early sign of intermediate-term trend reversal where the right shoulder of the pattern is probably being established around 1.1125.
Trade recommendations :
Conservative traders should wait for a bullish breakout above 1.1175 for a valid BUY entry with initial bullish target around 1.1235.
Risky traders can have a BUY entry anywhere around the current price levels (1.1124).
Initial bullish target should be placed at 1.1170 with tight S/L to be located below 1.1090.
