• Add
    Company

EUR/USD: Engulfing candle at a resistance zone, Is the Bear going to take over?

EagleFX

EUR/USD had a rejection at a level of resistance where the price had rejection twice earlier. The pair produced a bearish engulfing candle followed by a bullish inside bar. Then, it produced another bearish engulfing candle. Thus, the sellers may look to go short in the pair and drive the price towards the South further. Major intraday charts suggest that the price has been searching for resistance. Let us now have a look at three vital charts.

Chart 1 EUR/USD Daily Chart


The chart shows that the pair made a big bullish move. It found its resistance and had rejection twice around 1.19300. The pair had another rejection last week and produced a bearish engulfing candle. The next candle came out as a bullish inside bar followed by a bearish engulfing candle. This is a strong bearish pattern, which may attract the sellers to look for short opportunities. The price may find its next support around 1.17000. A daily breakout at the level may drive the price towards the South further. The price may make a long bearish move and find its support around 1.13500. On the other hand, if the level of 1.17000 works as a level of support, the price may get choppy within 1.17000 to 1.19300.

Chart 2 EUR/USD H4 Chart


The chart shows that the price made a bearish move upon producing an ABC pattern. It had a bounce at the level of 1.17550 and produced a bullish engulfing candle. However, the level of 1.18080 has been working as a level of resistance, which already produced a Doji candle. A bearish engulfing candle at the level followed by a breakout at the level of 1.17550 may drive the price towards the level of 1.17000. A bullish breakout at the level of 1.18080 may push the price towards the level of 1.18800.

Chart 3 EUR/USD H1 Chart


The H1 chart shows that the pair after making a long bearish move has been having a long bullish correction. The price has been roaming around the level of 1.18080. It produced a bearish engulfing candle. However, the price has been heading towards the level of support again. Another rejection followed by a breakout at the level of 1.17850 may drive the price towards the level of 1.17550. On the contrary, if the price makes a bullish breakout at 1.18080, the price may head towards the North and find its next resistance around 1.18315.

All these three charts are bearish biased. Considering these charts, it seems that the pair may end up producing another bearish candle. If the candle closes below the level of 1.17000, the pair may remain bearish in the daily chart for some days.

EagleFX Review

Disclaimer
!"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^_`abcdefghijklmnopqrstuvwxyz{|} !"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^_`abcdefghijklmnopqrstuvwxyz{|}