EURO-DOLLAR SCENARIO UPDATE|STRUCTURE ANALYSIS
Updated
EURUSD has peaked at 1.19, breaking out of the strong resistance in red, yet failed to seal the gains and rolled back, unwinding the breakout.
However, the diagonal 11 year treandline is certainly broken, as the weekly candle closed above it.
Therefore, there are three scenario for the EURUSD in the near future
SCENARIOS:
Scenario 1- the most likely one: the pair will be bouncing beck and forth between the red resistance and the diagonal trendline, having that as a form of diagonal correction. It is however necessary for the diagonal support to be broken.
Scenario 2- As the diagonal support is unbroken, it is possible for the red resistance to get broken again and the 1.19 level to get retested, forming a double top. 1.19-1.20 level for EURO is economically unsustainable, thus I don't think that the pair can stay there for long
Scenario 3-EURUSD finally goes back below the trendline, to the green support, as a from of manifesting a realization that the latest breakout was a temporary matter.
Scenario 1 gives great opportunities for both longs and short, allowing us to trade the reverse triangle, but wait for the diagonal support to be broken.
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Note
Scenario 2 is pumping!
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