Long-Term Support Breakout: Short-Term Buy Opportunity?This currency pair presents an intriguing opportunity as it breaks through the long-term monthly support. However, confirmation of this breakout will depend on the closing of the candle at the end of the month.
On the weekly charts, the price briefly dipped below 0.86 before closing the week above it. This level holds significance as it aligns with the weekly close area from the 2015 depegging. So, what can we expect next?
In the short term, considering the extreme oversold conditions on lower timeframes, I will be observing a potential retracement towards the monthly breakout area around 0.88.
My strategy for this pair involves waiting for an early next week dip below 0.86, followed by a buy signal on my TRFX indicator on a chart ranging from 4-hour to 12-hour timeframes. The target will be around 0.88, with the stop set well below the recent low, possibly around 0.85.
For the long term, our focus may shift towards targeting the depegging low or the monthly buy/demand zone, starting around 0.80. Personally, I'd prefer to see a pullback to 0.88 and evaluate the monthly candle close to confirm the legitimacy of the breakout.
I will provide regular updates on the progress as we navigate this trade opportunity.
