EURUSD Technical analysis & Weekly Trading Plan 21-25 Aug

EUR / USD Outlook Today

By mid-July, the duo achieved a high that lasted for several months at 1.1276. However, the euro lost its value as the dollar gained strength, prompting sellers to take control. Recently, bears were able to establish themselves around the 1.08 mark, but they were unable to remain under the support level of 1.0850.

EURUSD in the Correction Phase In Daily Chart

Based on our observations in the daily time frame, the market has been exhibiting a bullish trend in recent weeks. However, we have now noticed a retracement towards the lower end, which could indicate a correction phase. The initial reaction was in favor of the US dollar due to the Federal Reserve’s hawkish stance, but this has since faded away,  Although the markets have largely ignored this data so far, there may be increased price volatility closer to the release of the NFP figure. 

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4-Hour Chart – Downtrend

Based on the analysis of the 4-hour chart, it appears that the market attempted to move in a bullish direction but was met with resistance and was unable to establish any significant bullish patterns. This suggests that there may be some remaining liquidity on the downside, meaning that the market could potentially continue to move in a bearish direction. It’s important to keep an eye on the market’s movements and patterns to gain a better understanding of its direction and potential future movements. Also, the market has broken its recent lower low which also indicates that the market will continue a bearish trend to take off liquidity from the left. Now, look on the left side, Here is an equal low pattern usually it’s a liquidity pool & Market may take off this liquidity. 

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It is also considerable that below the liquidity pool there is also a demand zone, so most probably market will down to this demand area also.

Micro Structure in 1 Hour chart

Looking at the 1-hour chart, it appears that the market has broken through the recent low. Additionally, there is a supply zone present which suggests that the market may attempt to mitigate this zone before continuing to move in a bearish direction. It’s important to keep in mind that while this zone may provide some temporary support, it’s not a guarantee that the market will reverse its trend. It’s important to continue monitoring the market’s movements and patterns to gain a better understanding of its direction and potential future movements.

Our Trading Plan for ERUSUSD

Finally, based on the analysis of the market, it seems that the trading plan is to enter into a short trade from the supply zone, provided that all other aspects are met. If this trade is executed, there will be two targets to consider. The first target will be the nearest liquidity pool, which is a level where there is a significant amount of buy orders and liquidity. The second target will be the demand zone, which is a level where there are a significant number of buy orders and demand for the asset. It’s important to keep an eye on the market’s movements and patterns to ensure that all other aspects of the trading plan are met before entering into a trade. Additionally, it’s important to have a solid risk management plan in place to minimize potential losses.