EURUSD 7 Dimension Sell Trade Idea Top-Down View (H4 Analysis):
The H4 timeframe shows that the price has recently formed a Change of Character (CHoCH) and appears to be making a retracement. Despite this pullback, it hasn’t mitigated the higher-timeframe Points of Interest (POI), particularly the unmitigated Daily Fair Value Gap (FVG). Observing H1, we see considerable volatility and uncertainty, possibly indicating attempts to shake out weak-handed traders before a deeper corrective move toward the H1 internal extreme POI for mitigation.
😇 7 Dimension Analysis
🟢Time Frame: H4
🟢Swing Structure:
Bullish with CHoCH: The swing structure is bullish on the H4, with a recent CHoCH indicating a potential shift. An inducement has been observed, and price has just entered the discounted zone, which aligns with the 61% Fibonacci retracement level.
POI and Liquidity Levels: The area of interest includes the 61% & 88% Fibonacci level, liquidity sweeps, and support at the demand zone. Waiting for price to reach this zone and observing its reaction will be critical.
Pattern:
🟢 Chart Patterns:
Double Bottom: Forming as a potential reversal pattern at the discounted zone.
🟢 Candle Patterns:
Long Wick & Momentum Candles: Recent candles show long wicks and momentum on the downside, indicating that bears are still in control of the current session, albeit with limited momentum strength for long-term sustainability.
Volume:
Moderate volume suggests that while sellers are currently dominant, the bearish momentum may not hold for an extended period, reinforcing the expectation of a retracement.
Momentum (RSI):
🟢 Range Shift: Momentum has shifted from bearish to sideways with multiple bullish divergences, suggesting a loss of bearish strength and a potential for reversal or retracement.
Volatility (Bollinger Bands):
🟢 Middle Band Breach: The price has dropped below the middle band, indicating a slight bearish bias.
Expansion Cool-Down: Following a period of expansion, price appears to be consolidating and "cooling down" before the next directional move.
🟢Strength (ROC and Consolidation):
Consolidation Phase: ROC reflects consolidation, supporting the idea that the bearish momentum may pause or weaken, aligning with the expectation of a retracement or sideways movement.
🟢Rating: ⭐⭐⭐
Probability: 65%
This setup has a moderate confidence level for a short-term sell entry, considering the confluence of factors on both the H4 and refined lower time frames.
🟢Trade Setup:
Entry Details:
Entry Time Frame: 15-Minute (15M)
Entry TF Structure: Bearish (for counter-trend entry in a corrective move)
Point of Interest (POI): Extreme Fair Value Gap (FVG)
Trade Execution:
💡 Decision: Sell Limit
🚀 Entry: 1.8747
✋ Stop Loss: 1.0888
🎯 Take Profit: 1.07927
😊 Risk to Reward Ratio: 6.94 RR
🕛 Expected Duration: 1 Day
SUMMARY:
This H4-based top-down analysis with entry refinement on the 15M timeframe provides a short-term sell opportunity within a bullish higher timeframe structure. Price action, volume, and momentum indicators suggest a potential bearish pullback toward the 15M POI, aligning with the 61% Fibonacci level and significant liquidity areas. The setup targets a short-term retracement with a high reward-to-risk ratio, with the expectation that price may retrace to mitigate lower timeframe liquidity levels before resuming the bullish trend.
