FxWirePro: EUR/USD shooting star resumes bears in major trend, interim bulls exhausted at 21-EMA to extend rallies upto channel resistance

EURUSD major trend has been sliding through slopping channel. The prices began consolidating ever since bulls took support at 1.0453 levels. As a result, we’ve seen bull swings after dragonfly doji (which is bullish pattern), for now, no momentum is seen and bulls have exhausted at 21EMA, so the bears have resumed.

Although EURUSD spiked from channel support at 1.0453 levels, it has been struggling to bounce further above 21SMA levels on the weekly (see both daily and weekly charts), as a result, we’ve seen shooting star candle occurred at 1.0757 levels where stiff resistance is observed historically.

Please be noted that the price has collapsed exactly from that juncture where we see the strong resistance to the current 1.0636 levels. This shooting star on daily plotting evidences price dips below DMAs.

To substantiate this bearish stance, 21DMA crosses over 7DMA which is a bearish DMA crossover to bring in more slumps.

RSI indicates convincing strength in declining trend downward with its convergence to the prevailing prices declines.

While stochastic curves remain below oversold zone (on dailies), still signals indecisiveness.

MACD’s indicates indecisiveness on monthly terms but remains bearish biased.

It is wise to snap rallies to deploy fresh shorts as you see no traces of indications of the robust uptrend for now, instead trace out selling momentum on shorter term charts.

Trade tips:

Well, contemplating above technical reasoning, on speculative grounds we advise tunnel spreads which are binary versions of the debit put spreads.

This strategy is likely to fetch leveraged yields than spot FX and certain yields keeping upper strikes at 1.0692 (around 50 pips) and lower strikes at 1.06 levels (40 pips on southwards).