TRADE EURUSD DOWNTREND WITH CAUTION. AWAIT BREAK OF 1.1500!
As of today 23/08/2021, EURUSD is in downtrend! For the current week, consolidation move is expected which would target 1.18000 region. After that the downtrend is expected to resume. However whenever trading, its advisable to await a suitable confirmation that would enhance the quality of the analysis.
Have a look at the main EURUSD monthly chart. the blue horizontal lines represent concrete support and resistance levels. Currently for the downtrend to resume, the price will likely retrace towards 1.18000 region first and fall towards the 1.15000 area. However in between these two levels there lies monthly 50 EMA. 50 EMA is proven to act as a dynamic support and resistance on any TIMEFRAME. So caution must be exercised while trading the potential downtrend fall from 1.18000 to 1.15000 region.
POTENTIAL TRADING STRATEGY
If one decides to trade between these two levels (1.18 to 1.15) please be advised to trade carefully. Every trade needs a confirmation to enhance its quality and currently the presence of 50 EMA on monthly TIMEFRAME is a risky move to trade the downtrend. THE PATH OF LEAST RESISTANCE FOR EURUSD LIES BETWEEN 1.15 TO 1.12.
So for a trade with high quality and good probability it is advisable to wait for the break of monthly 50 EMA and 1.1500 support
1) MONTHLY CANDLE NEEDS TO CLOSE BELOW MONTHLY 50 EMA FIRST
2) MONTHLY CANDLE SHOULD IDEALLY CLOSE BELOW 1.15000 AS WELL.
3) IF MONTHLY CANDLE CLOSED BELOW MONTHLY 50 EMA, ITS POSSIBLE TO WAIT FOR WEEKLY CANDLE TO CLOSE BELOW 1.1500 AND GO
SHORT TO TARGET 1.12000
PROBABLE TARGET HERE IS 1.12000 LEVEL. BUT THE ABOVE SCENARIO SHOULD TAKE PLACE FIRST. THIS WOULD ENHANCE THE QUALITY OF THE TRADE AND ITS PROBABILITY
FUNDAMENTALLY, USD is expected to get stronger as the economy shows the sign of improving and FED taper talks. USD acting as safehaven in RISK OFF mood would likely support the dollar as well. Focus would shift to the The Jackson Hole Economic Symposium, during which the FED chairman would likely focus on tapering and provide insights into FED future action.
Therefore this week we should notice EURUSD consolidation towards 1.18000 and then next week downtrend should resume! However it is advisable to trade EURUSD once the M 50 EMA and 1.15000 level breaks. the target here would be 1.12000 level
Shall there be any updates in the future i will provide the entry details in the comment section
Have a look at the main EURUSD monthly chart. the blue horizontal lines represent concrete support and resistance levels. Currently for the downtrend to resume, the price will likely retrace towards 1.18000 region first and fall towards the 1.15000 area. However in between these two levels there lies monthly 50 EMA. 50 EMA is proven to act as a dynamic support and resistance on any TIMEFRAME. So caution must be exercised while trading the potential downtrend fall from 1.18000 to 1.15000 region.
POTENTIAL TRADING STRATEGY
If one decides to trade between these two levels (1.18 to 1.15) please be advised to trade carefully. Every trade needs a confirmation to enhance its quality and currently the presence of 50 EMA on monthly TIMEFRAME is a risky move to trade the downtrend. THE PATH OF LEAST RESISTANCE FOR EURUSD LIES BETWEEN 1.15 TO 1.12.
So for a trade with high quality and good probability it is advisable to wait for the break of monthly 50 EMA and 1.1500 support
1) MONTHLY CANDLE NEEDS TO CLOSE BELOW MONTHLY 50 EMA FIRST
2) MONTHLY CANDLE SHOULD IDEALLY CLOSE BELOW 1.15000 AS WELL.
3) IF MONTHLY CANDLE CLOSED BELOW MONTHLY 50 EMA, ITS POSSIBLE TO WAIT FOR WEEKLY CANDLE TO CLOSE BELOW 1.1500 AND GO
SHORT TO TARGET 1.12000
PROBABLE TARGET HERE IS 1.12000 LEVEL. BUT THE ABOVE SCENARIO SHOULD TAKE PLACE FIRST. THIS WOULD ENHANCE THE QUALITY OF THE TRADE AND ITS PROBABILITY
FUNDAMENTALLY, USD is expected to get stronger as the economy shows the sign of improving and FED taper talks. USD acting as safehaven in RISK OFF mood would likely support the dollar as well. Focus would shift to the The Jackson Hole Economic Symposium, during which the FED chairman would likely focus on tapering and provide insights into FED future action.
Therefore this week we should notice EURUSD consolidation towards 1.18000 and then next week downtrend should resume! However it is advisable to trade EURUSD once the M 50 EMA and 1.15000 level breaks. the target here would be 1.12000 level
Shall there be any updates in the future i will provide the entry details in the comment section
