The price zone 1.3800-1.3880 (dotted on the chart) provided considerable SUPPLY for the EUR/USD pair. This price zone managed to pause the bullish momentum that originated off the depicted bullish trend line.
Thus, a Double Top reversal pattern was established with a neckline located at 1.3700. This reversal pattern has already hit its projection levels.
On the other hand, we should highlight Thursday and Monday's bullish engulfing daily candlesticks which emerged off 1.3500 (the lower limit of the ongoing 4H channel) thus fixating again above 1.3560 (Key-Level corresponding to previous prominent bottom).
As long as the bulls keep defending the recent low around 1.3575 we considering the possibility of a bullish Head and Shoulders pattern with neck-line around 1.3650 with a breakout projection target to be anticipated around 1.3750.
Price zone 1.3600-1.3560 ( 50% and 61.8% Fibonacci levels ) should be anticipated for bullish price action offering a valid BUY entry at retesting.
This price zone corresponds not only to significant Fibonacci levels but also to the backside of the broken bearish channel depicted on the DAILY chart.
The material has been provided by InstaForex Company - www.instaforex.com
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