After forming a 3-pin-formation rejecting the weekly resistance level of 1.3700, price has wasted no time with continuing its decent into the month of July after the almost 600 pip marubozu. 1.2800 (monthly support) has been firmly broken, and I’m expecting new lows to be made below 1.2460.
Another confluence to add is that fact that our E.M.As are about to cross to the downside, only strengthening my bear bias.
After 4 firm weeks of the US Dollar losing strength (5.65% vs CAD), the weekly trend-line was broken, now a break below 1.2500 is imminent.
Once this is achieved, I’d be hesitant to sell this pair until we see a daily retracement, possibly back up into 1.2800.
Reason for entry:
- Obvious Monthly + Weekly bearish confluences
- Good Risk:Reward ratio
- Evening star formation from between the Fib 61.8-78.6% levels in a series of lower lows and lower highs.
- C.T.L break
Targets are set at the weekly resistance level of 1.2500, where a retracement is expected after reaching.