Overview:- By looking at the daily chart we can see that overall pair is trading between the downtrend channel and every swing is making successively lower highs and lower lows. A very balanced demand and supply can be seen in the pair. The short term to intermediate trend is down and in downtrend market always sell on highs will be profitable strategy. From past couple of days we are witnessing some bullish candles which is nothing but pair is trying to test the upper resistance line of the downtrend channel from here we are expecting that pair will follow its primary trend.
Overall one more thing we can notice that between the 1.0900 and 1.1100 level we witnessed so many roller coaster moves and since last 3-4 weeks pair was moving between these levels.
Technical prospective:- From technical prospective we can see that a down trend channel is in process of formation where very balanced demand and supply is going on with downside momentum and we can say that tug of war is going on, however there are high chances that we may see strong downside momentum as pair has tested 50 Day EMA line along with the upper line of the downtrend channel.
Odds are in favor of bears and our bias remains bearish on the pair as long as 1.1100 level remains intact, as we know that primary trend is down and secondary trend is also down. MACD indicator is overlapping with each other and unable to provide any signal. RSI arrived at 50 level where it is also providing us neutral signal.
What next:- A daily closing below 1.0970 level will open the way towards the 1.0900 in coming trading sessions and convert every bounce as selling opportunity. On contrary a strong momentum above 1.1100 level will change the outlook from bearish to bullish. The pair could face the next support at 1.0940 ahead of 1.0900. On the upside, resistances align at 1.1060 and 1.1100.
Trade idea:- Based on chart and studies above we can suggest that sell the pair at 1.1010-1.1020 for the target of 1.0900 and 1.0850 with the tight stop loss of 1.1100.
