Hello traders. Have a great weekend. Trading instrument -
EUR/USD Weekly timeframe. As we can see, the price has been moving short with a decrease in highs after a false breakout from the level zone -
1.18095. This whole situation can be interpreted in two ways. The first, most immediate one is that the price is moving short, indicating a reversal to the downside. However, on the other hand, it can be seen that the price initially moved globally in a bullish trend, so this decrease in highs can be considered a short correction within the framework of the bullish global trend. However, the price has not confirmed this yet. Currently, the price is showing a new decrease in highs and some bullish activity, which may either continue. In that case, this current bullish manipulation can be considered a correction within a downtrend, leading to a move to the south with a breakthrough of support, as weekly bearish candles have started closing below.
Daily timeframe. On this timeframe, it can be noted that the price traded where the main support was the round level
1.16000. However, this support started to break short, shifting slightly lower to the zone
1.15627. This is not happening just because the price feels like it, but because two factors are exerting direct bearish pressure on the price. This may indicate that buyers are not particularly keen on pushing the price further. They might believe that the instrument has already reached a zone that can be considered overpriced, leading the price to fall short whether they like it or not. This situation can be vividly compared to a regular market where if prices are significantly inflated, vegetables and fruits are not bought, and then the seller will lower the price. In this case, the buyer is behaving passively in general, and this bullish movement can currently be considered a regular correction within a downtrend. At this point, it can be stated either about the end of the correction or the first signs of the culmination of the bullish correction.
H1 timeframe. Understanding that the situation on the higher timeframe is still uncertain, indicating a proximity to a price breakthrough towards a short movement. Currently, we are observing the seller's reaction from the previously broken zone -
1.15627 short, which now acts as resistance. The price may either go short on the next candle or manage to slightly go long towards the zone
1.16000 where a culmination of the long correction may occur, followed by a price reversal to the short side.
