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EURUSD Fails to Hold 1.1360 as New Support, Eyes 1.1217

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Last Friday was the largest single-session rally for EURUSD since the March 10th ECB decision. But after gaining 280 pips from Friday’s low, the single currency appears to have exhausted its resources.

The 1-hour chart below shows why I wasn’t a buyer of the pair over the last few sessions.

Upward sloping flag pattern on the 1-hour chart

As noted in a previous lesson, upward sloping flags such as this don’t often bode well for those with a bullish interest. A similar pattern formed in mid-April just before the pair lost 130 pips.

Not only that but yesterday’s session formed a bearish engulfing pattern that has broken back below the 1.1360 handle. The pair managed to hold above this level briefly during Wednesday’s session but has failed to maintain it as new support.

This break re-exposes the previously mentioned 1.1217 support level. Additionally, I’m also keeping an eye on the trend line that extends from the December 2015 low.

As has been the case since October of last year, I will only entertain selling opportunities as my bearish bias for EURUSD has yet to be challenged in a meaningful way.

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EURUSD support and resistance levels

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4 comments
Aamir Naseer says

Hi Justin. I really appreciate your efforts. You are doing fantastic. I need to know. Should i execute a short trade?

Reply
    Justin Bennett says

    Aamir, I’m glad you’re finding it helpful. That isn’t my decision to make.

    Reply
Margaret says

That was great! We just learnt about upward sloping flag and it showed up live, brilliant!
I love it. Thank you Justin.

Reply
    Justin Bennett says

    You’re welcome, Margaret. It’s certainly a handy pattern that can keep you out of trouble.

    Reply
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