Based on my personal view, the EURUSD pair may be on the verge of forming a bearish rising flag pattern followed by a corrective wave to the 38.2% Fibonacci retracement level. This setup could pave the way for a continuation of the downtrend, offering a strategic entry point for short positions.
Bearish Rising Flag Formation:
We would need to closely monitor the formation of a bearish rising flag pattern. This pattern typically occurs within a downtrend and consists of a consolidation phase. The flagpole represents the initial sharp decline, followed by the flag formation as the price consolidates. If EURUSD successfully forms this pattern, it could signal the potential resumption of the downtrend and present an attractive setup for short positions.
Wave 2/(b) Correction to 38.2% Fibonacci Retracement:
Following the completion of the bearish rising flag pattern, I anticipate a corrective wave to the 38.2% Fibonacci retracement level. This corrective wave corresponds to wave 2 or wave (b) within the larger downtrend. The 38.2% Fibonacci retracement level often serves as a key support/resistance level and is closely watched by traders. Once the price reaches this level, I'll carefully observe price action for signs of a reversal or continuation of the downtrend.
Potential Continuation for Short Position Wave 3/(c):
Upon reaching the 38.2% Fibonacci retracement level, I may look into considering a short position as the price shows signs of rejection or reversal. This could signal the beginning of wave 3 or wave (c) to the downside, with the potential for significant downward movement.
In summary, EURUSD could present an opportunity for us, with the potential formation of a bearish rising flag pattern followed by a corrective wave. I would personally closely monitor price action for confirmation of the pattern and be prepared to capitalize on the downside movement with well-timed short positions. As always, proper risk management strategies should be employed to mitigate potential losses and maximize profits.
Bearish Rising Flag Formation:
We would need to closely monitor the formation of a bearish rising flag pattern. This pattern typically occurs within a downtrend and consists of a consolidation phase. The flagpole represents the initial sharp decline, followed by the flag formation as the price consolidates. If EURUSD successfully forms this pattern, it could signal the potential resumption of the downtrend and present an attractive setup for short positions.
Wave 2/(b) Correction to 38.2% Fibonacci Retracement:
Following the completion of the bearish rising flag pattern, I anticipate a corrective wave to the 38.2% Fibonacci retracement level. This corrective wave corresponds to wave 2 or wave (b) within the larger downtrend. The 38.2% Fibonacci retracement level often serves as a key support/resistance level and is closely watched by traders. Once the price reaches this level, I'll carefully observe price action for signs of a reversal or continuation of the downtrend.
Potential Continuation for Short Position Wave 3/(c):
Upon reaching the 38.2% Fibonacci retracement level, I may look into considering a short position as the price shows signs of rejection or reversal. This could signal the beginning of wave 3 or wave (c) to the downside, with the potential for significant downward movement.
In summary, EURUSD could present an opportunity for us, with the potential formation of a bearish rising flag pattern followed by a corrective wave. I would personally closely monitor price action for confirmation of the pattern and be prepared to capitalize on the downside movement with well-timed short positions. As always, proper risk management strategies should be employed to mitigate potential losses and maximize profits.