Overview:- By looking at the daily chart we can see that overall pair is trading between the downtrend channel and it is heading downside with strong bearish sentiments and it is moving clearly in downtrend and we always see a bounce at the bottom line of the channel. 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 we may see a bearish marabuzo candlesticks below the moving average lines.
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 so in a downtrend market always sell on high will be profitable strategy. A bearish crossover on MACD indicator is favoring the bears and providing us sell signal for the time being. RSI arrived in the negative territory i.e. below 50, which is supporting the bears.
What next:- A daily closing below 1.0900 level will open the way towards the 1.0800 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 1.0925 ahead of 1.0900. On the upside, resistances align at 1.1160 and 1.1200.
Trade idea:- Based on chart and studies above we can suggest that sell the pair at 1.0970-1.0980 for the target of 1.0900 and 1.0850 with the tight stop loss of 1.1070.
