Last Tuesday I wrote that the future direction of EURUSD hinged on 1.1430. The very next day, sellers had their moment.
The single currency reached a session high of 1.1500 on November 7th, but sellers forced a sub 1.1430 close.
That was our signal to go short. At the very least, it suggested sellers had no intention of letting up.
Between Thursday and Friday of last week, EURUSD gave up another 90 pips. That led me to suspect an imminent breakdown. In fact, that’s exactly what I wrote on Sunday.
I didn’t expect it to happen so soon, but I’m not too surprised given the bearish momentum of late.
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Now that you’re all caught up, what’s the game plan going forward?
It’s the same as it has been since late September:
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Watch for selling opportunities from new resistance.
In my opinion, the ideal entry was at 1.1430 following the November 7th bearish rejection. The next best entry would be a retest of 1.1300 as new resistance.
But as with every breakout, the question remains:
Will EURUSD retest 1.1300 before reaching the next key support at 1.1130?
That’s anyone’s guess at the moment. However, you never want to chase a market even if that means missing part of a move.
Chances are we’ll see another bounce at some point. Just look at the price action since this latest decline began in late September.
Everytime EURUSD drops more than 300 pips, we get a bounce of approximately 200 pips.
The distance from last week’s high of 1.1500 to support at 1.1130 is 370 pips. And from 1.1130 support to new resistance at 1.1300 it’s 170 pips.
That means EURUSD may or may not retest 1.1300 before moving lower, but the recent price action suggests we will likely see a bounce from 1.1130 back to 1.1300 if sellers make it that far, of course.
To be clear, I have no intention of buying the pair at 1.1130. In fact, I still have my short position from 1.1430 and will likely add to it if the euro does retest 1.1300 before moving lower.
As long as this bearish momentum is intact, I’m only interested in selling.
Important: I use New York close charts so that each day closes at 5 pm EST.
Click here to get access to the same charts I use.
Leave a Comment:
39 comments
Hi Justin,
Thanks for your valuable analysis and continuous support…
When we look in Weekly chart it is showing similar to Head & Shoulders pattern….but not sure…could you pls confirm whether it is valid one or not ?
You’re welcome. It could be. I’d prefer an ascending neckline though.
I am targeting 1.09
Thanx for your analysis justin I also held my sells from 1.1430 resistance after bulls failed to violate that pivot point,I also think the pair would retest the newly support turned resistance before pushing down again,many people are buying now which is against the trend, but I’d rather wait
Your analysis are great man, have learned at lot, in other words you are a blessing man.
Thanks, Nyasha. Glad it’s helping.
Thanks Mr Justin you open up my eyes
This is another great analysis, man. Thanks for this awesome job.
Thanks, Steve. It’s my pleasure.
Anytime. Feel free to ask questions.
I’ll go with 1.3000.thanks Justin.you’re the best.
You mean 1.1300 as new resistance?
Yes Malik.age is catching up.1 is missing there.cheers!
You’re welcome, Abe. Thanks for stopping by.
Thank you for your analysis Mr Justin
Anytime Mr. Agrey. 🙂
So far so good. (-: 1.11391 is todays S3
Hi sir I see you talked about Pivot points.
Would you mind giving me guidance on how to use Pivot points please.
I don’t use pivot points. I sometimes call a support or resistance level a “pivot”, but that’s different.
Thank you so much.
You’re very welcome.
as for me, 1.1130 level is the target
Excellent looking your analysis. Thank you very much boss
Anytime, Sumantra. Let me know if you have questions.
You make Forex looks simple
I now hold my positions with confidence knowing where the targets are
That’s been the goal from day one, so I’m glad it’s working. Cheers.
Should market still in downtrend i am targeting 1.1130 or i should short from 1.1300
That’s your decision. My thoughts are detailed above.
market close below 1.13000 but now market try to break the level 1.1300
I have 3k in euro what to do
That’s your decision.
At the moment prices bounced from 1.1217 back to the fib 38.2, from the 11/7 1.15 level. If the current 4hr bar closes below 1.1300, I’m thinking good short opportunity down to 1.116, about the fib 123.6 extension. On EJ, I’m currently short from a very similar setup except resistance is fib 50 form the 11/7 high. Does this sound reasonable?
As long as it meets your criteria. That’s most important.
I have been patiently looking into this one. 1.1300 has been tested we looking down it seems checking on H4
Sure, but you don’t need the 4-hour time frame to see that. 🙂
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