Few weeks ago, a bullish Head and Shoulders reversal pattern was demonstrated around 1.1200.
This enhanced further bullish advancement towards 1.1300-1.1315 (supply zone) where significant bearish rejection was demonstrated on April 15.
Short-term outlook turned to become bearish towards 1.1280 (61.8% Fibonacci) then 1.1235 (78.6% Fibonacci).
For Intraday traders, the price zone around 1.1235 (78.6% Fibonacci) stood as a temporary demand area which paused the ongoing bearish momentum for a while before bearish breakdown could be executed on April 23.
That's why, the price zone around 1.1235-1.1250 has turned into supply-zone to be watched for bearish rejection.
On the other hand, the market has failed to sustain bearish pressure below the price Level of 1.1175 during last week's consolidations.
That's why, another bullish pullback was expected to occur towards 1.1230-1.1250 which is currently being breached to the upside.
Trade recommendations :
Conservative traders should be waiting for a H4 bearish closure below the depicted supply zone (1.1235-1.1250) for another valid SELL entry.
S/L should be placed around 1.1260.
Initial Target levels should be located around 1.1200, 1.1175 and 1.1140.
The material has been provided by InstaForex Company - www.instaforex.com