After simulating a bull attack yesterday just before NY session, EURUSD resumed the move down on H4 chart & right now has a nice bearish momentum. As many times in the past, the small charts failed to convince the H4 to close bullish above 1.40 (previous resistance now enforced + H4 200MA) & as a result the bullish momentum reversed abruptly in US session.
The daily picture looks more & more clearly down at least until the pair tests the 1.36 area (could be an A-B-C correction – my daily &H4 green waves – or it could be the beginning of a large impulsive drop, after all august is coming…). The D1 TL @1.40 was broken & re-tested yesterday around 1.4050, another argument favoring shorts in short-term & even mid-term.
The way I see it, 1.4000 has now turned into a protective barrier against big bulls – as long as price keeps making lower highs & lows below this level shorts are definitely safe. My strategy for London session today is shorting small H1/M15 rallies up to 1.3930 & 1.3950, taking low-risk trades with target around 1.3840. If this level breaks the road is clear all the way down to 1.3670 & below. Whatever money management I might be using, stops will not be above 1.3990 at any time.
Good luck & good trading!