EUR/USD Bearish Reversal Analysis – Daily Chart
Analysis:
The EUR/USD daily chart shows a rising wedge formation, which is typically a bearish reversal pattern. Price action is currently near the top boundary of the wedge around 1.17540, a key resistance level and potential double top area.
The market has previously reacted from the 0.5 Fibonacci level (1.12374), which now acts as a support zone.
A bearish divergence is likely forming on the stochastic indicator, which suggests weakening bullish momentum.
The price is expected to break down from the wedge and head toward the support region between 1.13122 and 1.12374, aligning with the wedge’s lower trendline and the 200-day EMA.
If that zone fails, further downside toward 1.07327 is possible.
Conclusion:
A breakdown from the rising wedge could trigger a sharp bearish move. The key level to watch for confirmation is a daily close below the wedge support line. Rejection from the upper boundary increases the probability of this scenario.
Trade Setup, Take Profit (TP), and Stop Loss (SL)
Trade Setup:
Type: Sell (Short)
Entry Zone: Around 1.17500 – 1.17800 (near the top of the rising wedge)
---
Stop Loss (SL):
SL:1.18850
Just above the wedge’s upper resistance and recent high – gives the trade room to breathe.
---
Take Profit (TP) Levels:
1. TP1:1.15150 – First horizontal support and previous structure.
2. TP2:1.13120 – Lower wedge boundary and confluence with support zone.
3. TP3:1.12370 – 0.5 Fibonacci level and major support area.
4. TP4 (Extended):** **1.07320** – If price breaks below the major support.
---
Risk/Reward Tip:
Best to trail the stop once TP1 or TP2 hits to lock in profit.
Ensure proper position sizing as this is a swing setup on the daily chart.
Analysis:
The EUR/USD daily chart shows a rising wedge formation, which is typically a bearish reversal pattern. Price action is currently near the top boundary of the wedge around 1.17540, a key resistance level and potential double top area.
The market has previously reacted from the 0.5 Fibonacci level (1.12374), which now acts as a support zone.
A bearish divergence is likely forming on the stochastic indicator, which suggests weakening bullish momentum.
The price is expected to break down from the wedge and head toward the support region between 1.13122 and 1.12374, aligning with the wedge’s lower trendline and the 200-day EMA.
If that zone fails, further downside toward 1.07327 is possible.
Conclusion:
A breakdown from the rising wedge could trigger a sharp bearish move. The key level to watch for confirmation is a daily close below the wedge support line. Rejection from the upper boundary increases the probability of this scenario.
Trade Setup, Take Profit (TP), and Stop Loss (SL)
Trade Setup:
Type: Sell (Short)
Entry Zone: Around 1.17500 – 1.17800 (near the top of the rising wedge)
---
Stop Loss (SL):
SL:1.18850
Just above the wedge’s upper resistance and recent high – gives the trade room to breathe.
---
Take Profit (TP) Levels:
1. TP1:1.15150 – First horizontal support and previous structure.
2. TP2:1.13120 – Lower wedge boundary and confluence with support zone.
3. TP3:1.12370 – 0.5 Fibonacci level and major support area.
4. TP4 (Extended):** **1.07320** – If price breaks below the major support.
---
Risk/Reward Tip:
Best to trail the stop once TP1 or TP2 hits to lock in profit.
Ensure proper position sizing as this is a swing setup on the daily chart.
🟡 TELEGRAM CHANNEL:
Free Signals With Technical Chart:
t.me/+JLFlD0eg3LFjNjU8
📞TELEGRAM ME
@t.me/daniel9145
Free Signals With Technical Chart:
t.me/+JLFlD0eg3LFjNjU8
📞TELEGRAM ME
@t.me/daniel9145
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
🟡 TELEGRAM CHANNEL:
Free Signals With Technical Chart:
t.me/+JLFlD0eg3LFjNjU8
📞TELEGRAM ME
@t.me/daniel9145
Free Signals With Technical Chart:
t.me/+JLFlD0eg3LFjNjU8
📞TELEGRAM ME
@t.me/daniel9145
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.