- 4H and 1H: The EUR/USD was supported above 1.2150, and is now in a correction after a small reverse head and shoulders seen in the 1H chart. The 4H chart shows that the momentum is bearish overall as it came down after testing 60 and broke below 40 and even 30.
- The 1H chart also shows the retracement back at 61.8%. The market is also testing its 200-period moving average.
- I would look for topping action here as we enter into the US trading session.
- If the market breaks above this 1.23 level, especially if it breaks above 1.2350 level, the bearish outlook towards 1.1880 should be shelved. Otherwise, if the market tops off and a strong decline follows, the likelihood of 1.2150 breaking is high.
- Since the current 4H candle is quite strong, the 1.23 level may be violated, but I would treat the 1.23-1.2350 as possible topping zone to monitor at the start of the US session.
Fan Yang Currency Analyst Commodity Trading Advisor
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