Around price level of 1.6780, a double-top pattern scenario was established with the neckline located around the price zone of 1.6620-1.6660.
Daily fixation below this price zone enabled the pair to reach 1.6464 (61.8% Fibonacci) as a projection target.
The recently achieved low of 1.6465 (also corresponding to a previous uptrend line) prevented further decline. Yet, the bulls were unable to fix above 1.6630-1.6666 (corresponding to a prominent top established on January 24).
This applied bearish pressure to push the pair back towards 1.6545 ( corresponding to the uptrend line and 50% Fibonacci ). Price action should be watched at retesting.
A slide below price zone of 1.6550-1.6535 applies bearish pressure on the pair to pursue towards lower lows around 1.6510 and 1.6470.
Otherwise, the uptrend remains intact and the bulls would be targeting at 1.6750-1.6775.
As suggested, the price zone of 1.6666-1.6690 offered a valid sell entry. Stop loss should be lowered to be four-hour closure above 1.6650.
The bears need to achieve a four-hour closure below 1.6600 to push for further lows. However, until now there's bullish support being offered at 1.6550 ( Friday's lowest price level ).
Moreover, there's lack of bearish follow up below 1.6600. All we can see is weak bearish candlesticks which can result in bullish reversal anytime.
On the other hand, four-hour fixation above 1.6650 will be a signal of weakness of the bears to pursue their downtrend exposing price levels of 1.6680 and 1.6775 for retesting.
The material has been provided by InstaForex Company - www.instaforex.com
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