Overview:- Earlier pair was falling from 2.1000 level continuously and arrived at 1.9372 where bears did their job in a good manner, but after arriving at these levels yesterday bulls took the charge and pushed the pair towards the north side and closed at 1.9535 level with bullish Marabuzo candlestick in the form of a bullish engulfing pattern on the daily chart.
Also, A downtrend line is still valid on the chart so we will get a clear trend reversal signal once bulls trades and sustains above the mentioned downtrend line i.e. above the 1.9600 level on the daily chart.
Technical Analysis:- From a technical perspective, it seems like pair has been bottomed out as it has given initial signal on 4 hourly chart and a potential rounding bottom pattern is in process of formation however we will get further bullish confirmation above 1.9605 level where 50 Day EMA line is lying. A valid breakout of 1.9504 with sustainability will open the way towards the 1.9800 and 1.20000 level in the near term. The way bulls are reacting at these low levels it seems like pair has bottomed out and it will now move to the north side.
On the daily chart also pair has bounced from a very strong key support level and there are high chances of triple bottom price pattern. Today’s closing matter a lot, however, it’s an early buy call for aggressive traders and positional traders may initiate their buy position above the 1.9600 level. A bullish crossover on the MACD indicator is favoring the bulls and providing us a bullish signal whereas RSI is also providing strength to the bulls and sustaining above 50 level on 4 hourly charts. The greet dots of SAR also suggesting us to buy.
What next:- The 1.9900 level is key resistance level followed by 1.2000 level whereas 1.9350 level is key support level followed by 1.9270 level.
Trade idea:- Based on the chart and studies above we would suggest buying the pair at current levels of 1.9500 and add further buy position above 1.9600 level for the target of 1.9800 and 1.2000 level with very tight stop loss of 1.9350 level.
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