The pair was pushed lower after breaking below major demand levels around 1.2100 and 1.2000 where historical bottoms were previously hit back in July 2012 and June 2010.
EUR/USD bears have already pushed the price slightly below the monthly demand level at 1.0550 (established in January 1997). Bullish recovery was expressed shortly after.
April’s candlestick came as bullish engulfing one. However, the next monthly candlesticks (May, June, July, and August) reflected the recent bearish rejection being expressed around 1.1450.
In the long term, a projection target will be still located at 0.9450 if a bearish breakout of the monthly demand level at 1.0550 occurs soon.
On the other hand, a bullish corrective movement towards 1.1500 will take place only if a high of 1.1465 gets breached.
This can be achieved if the current monthly candlestick closes above the weekly high (1.1465) late this month.
Recently, evident bullish recovery was expressed after hitting the level of 1.0800. Since then, bulls have been trying to achieve an extensive bullish movement towards 1.1500 and 1.1700.
Multiple ascending bottoms were established around the levels of 1.0830 and 1.1020. These levels corresponded to the current daily uptrend depicted on the chart.
Extensive bullish pressure was applied until bearish resistance was expressed around the level of 1.1700.
Recently, the market looked overbought as the bulls were pushing above the price level of 1.1500 (Daily Supply Level).
That is why a bearish movement is taking place towards the level of 1.1160 (61.8% Fibonacci level), which is being breached Today.
Daily persistence below the level of 1.1160 exposes the next demand level around 1.0980 where the daily uptrend comes to meet the pair.
Conservative traders can wait for a valid BUY entry around the price zone of 1.0980-1.1000 (the depicted uptrend line). S/L should be placed below 1.0950. T/P levels should be placed at 1.1080 and 1.1160.
The material has been provided by InstaForex Company – www.instaforex.com