Overview:– The daily chart is showing undoubtedly a blood bath in the pair and in the pair there is pure selloff no one is interested to buy the pair. But Pair has marked a low of 0.5500 level which is strong support level and low of multi year’s, and then we have seen steep recovery and it marked a high of 0.6200 which was 700 pips bounce from the low. Well the short recovery rally was limited to that level and now once again bears are dominating the bulls and taken the charge again.
From past couple of days bears got the charge and damaged too much for the buyers and it was pre expected from the bears at these levels. But now it seems like bears knocking the door at an secondary phase. We are expecting a strong sell off once again and it may mark a fresh low of this year.
Technical Analysis:-
From technical prospective we can see that a rounding top pattern is process of formation which is providing us bearish signal. Pair is receiving the supply pressure from price action and moving average lines. As pair is trading and sustaining below the moving average lines which is providing us bearish signal. A recent candle is evening start which is providing us trend reversal signal. Well it’s an early sell call but we will get further confirmation of the downside move once we see a daily closing below 0.5900 level today.
This week’s closing matters a lot which will decide the direction for upcoming week. Odds are in favor of bears and intraday bias remains bearish on the pair. as long as 0.6250 level remains intact. On contrary the 0.6200 level will be the first sign of bullishness and then a daily closing above this level will open the way towards the 0.6600 and 0.6800 level however there are very low chances of this upside momentum for the time being as long as Cronovirus exist world wide.
What next:- The 0.5900 level is the key support level followed by 0.5800 level where as 0.6100 level is the key resistance level followed by 0.6250.
Trade idea:- Based on chart and studies above we can suggest that sell at 0.6000 target is 0.5900 and 0.5800 with the tight stop loss of 0.6100.
