EURUSD Sell opportunity on a Double Top.
The EURUSD pair made a Double Top last week near the 1.12000 Resistance following the Fed Rate Decision (-0.50% cut) and technically this is the first sign of a potential medium-term sell opportunity.
If we examine the price action on the 1D time-frame going back 2 years (November 2020), we can see a recurring pattern. When the 1D RSI breaks above the 70.00 overbought barrier and posts a Lower Highs trend-line, a sell signal emerges, which is valid until the RSI approaches the 30.00 oversold level.
This sell signal has so far emerged 2 times (February 02 2023 and December 28 2023) and both times the pull-back that followed hit the 0.618 Fibonacci retracement level, below both the 1D MA50 (blue trend-line) and 1D MA200 (orange trend-line). The first correction registered a -4.70% decline while the second a -4.00%.
If this is a progressive pattern, then a potential new correction on the current RSI Lower Highs (Double Top for price) should be -3.30% (0.70 less than the previous), which as you can see on the chart falls exactly on the 0.618 Fibonacci retracement level.
As a result, this isn't just a strong sell signal but also gives us a very reliable Target at 1.08350.
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If we examine the price action on the 1D time-frame going back 2 years (November 2020), we can see a recurring pattern. When the 1D RSI breaks above the 70.00 overbought barrier and posts a Lower Highs trend-line, a sell signal emerges, which is valid until the RSI approaches the 30.00 oversold level.
This sell signal has so far emerged 2 times (February 02 2023 and December 28 2023) and both times the pull-back that followed hit the 0.618 Fibonacci retracement level, below both the 1D MA50 (blue trend-line) and 1D MA200 (orange trend-line). The first correction registered a -4.70% decline while the second a -4.00%.
If this is a progressive pattern, then a potential new correction on the current RSI Lower Highs (Double Top for price) should be -3.30% (0.70 less than the previous), which as you can see on the chart falls exactly on the 0.618 Fibonacci retracement level.
As a result, this isn't just a strong sell signal but also gives us a very reliable Target at 1.08350.
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** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. **
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