Since October 2, the EURUSD pair has been trending-up until October 21 when the pair hit the price level of 1.1175.
The price zone of (1.1175 - 1.1190) stood as a significant SUPPLY-Zone that demonstrated bearish rejection for two consecutive times in a short-period.
Hence, a long-term Double-Top pattern was demonstrated with neckline located around 1.1075-1.1090 offering valid bearish positions few weeks ago.
On the other hand, the price levels around 1.1000-1.0995 stood as significant DEMAND zone which has been offering adequate bullish SUPPORT for the pair so far.
Shortly-after, the EUR/USD pair has been trapped within a narrower consolidation range between the price levels of 1.1000 and 1.1085-1.1100 (where a cluster of supply levels and a Triple-Top pattern were located) until Wednesday.
Last week, significant bullish swing was initiated around 1.1040 allowing the current recent bullish breakout above 1.1110 to pursue towards 1.1175 within the depicted newly-established bullish channel.
Intraday bearish rejection was expected around the price levels of (1.1175). Quick bearish decline was expected towards 1.1115 (38.2% Fibonacci level).
Yesterday, the price level of 1.1115 stood as an Intraday demand level that prevented further bearish decline based on the recent bullish price action.
However, signs of negative divergence is currently manifested on the volume graph below. This probably indicates an upcoming bearish reversal to be anticipated.
That's why, Bearish breakout below 1.1080 is needed to invalidate the previous bullish scenario and activates the depicted Head & Shoulders Reversal Pattern.
If so, Bearish projection target to be located around 1.1040 and 1.1010.
Trade recommendations :
Intraday traders should wait for a bearish breakout below 1.1110 ( reversal pattern neckline ) as a valid SELL signal.
Bearish projection target to be located around 1.1040 and 1.1010.
