Overview:- By looking at the daily chart we can see that earlier bulls were rocking and seems in a party mood as we can see that in the last month the whole credit goes to bulls and initially bulls breached the downtrend channel and then it marked a high of 1.1180 level where 1.1100 was a psychological level and bulls able to break this level. In our previous report also we mentioned to buy the pair around 1.1100 for the target of 1.1180 with the tight stop loss of 1.1050 level and our target has been achieved so we are expecting that our readers must have minted profit from this move.
Technical prospective:- From technical prospective we can see that pair has started to get reverse from the exact 61.8% Fibonacci retracement line. The Fibonacci retracement was applied from 1.1406 to 1.0878 i.e. extreme peak and trough from intermediate point of view. Well one more thing we can see that pair has arrived at 200 SMA line which indicates that we may see further reversal signal.
It is just a starting of bears so we will get further bearish confirmation below the 1.1075 level. Overall pair is trading and sustaining between the moving average lines which is unable to provide any signal. A bearish crossover on MACD indicator is about to come which will be a recent development and RSI started to decline with a small divergence. Odds are in favor of bears and our bias remains bearish on the pair as long as 1.1188 level remains intact.
What next:- A daily closing below 1.1100 level will open the way towards the 1.1050 and furthermore in coming trading sessions and convert every bounce as selling opportunity. The pair could face the next support at 1.1100 ahead of 1.1050. On the upside, resistances align at 1.1170 and 1.1200.
Trade idea:- Based on chart and studies above we can suggest that sell the pair at CMP 1.1128 for the target of 1.1070 and 1.1020 with the tight stop loss of 1.1180.