Price Zone 1.3515-1.3560 represents a valuable Supply zone that kept price below for almost two months. The pair is showing some bearish rejection manifested in the Daily candlesticks of previous week as well as Monday's bearish engulfing candlestick. Looking at the Inside-Bar of Friday, a bearish retracement movement is expected after breakdown of Friday's low at 1.3495 to push the pair towards 1.3430 then 1.3375. Another probability that may happen if the pair returned to consolidate above 1.3495, is another bullish swing towards 1.3590-1.3600, provided that the bulls manage to break above 1.3550.
Show full picture A double-top pattern is being established where the neck-line is located around 1.3460. Fixation below this level will lead to 1.3425 then 1.3380 as targets for the confirmed pattern. Fixation above 1.3515 invalidates this bearish view mentioned above. However, a valid sell entry could have been taken around 1.3515 with a target at 1.3425 (where the lower limit of the movement channel is located) with SL located above 1.3545. Fundamentally, European business activity rises in the third quarter from the previous three months according to private sector report released today. However, the European central bank showed that the banks are not yet able or willing to lend despite of early signs of growth returning to the Euro zone. This may invalidate the bullish trials to step above 1.3515.
