Our expectations: The pair couldn't managed to break above 3.6221 where is the diagonal resistance and remain below 50 EMA, which indicates that we can expect decrease with stop at 3.6470. In order for a better positioning we can wait for correction of the engulfing candle and enter around 3.6000.
Alternative scenario: If the price breaks over EMA 50 , the negative scenario will be dismissed and we may look for a long positions with stop below 50 EMA.
Comments: Middle-term down trend, lower tops and lower bottoms. The price broke main horizontal support and failed to break main diagonal resistance when correction had been made.
Price action signal: Engulfing candle at levels of diagonal and horizontal resistance
Technical indicator:
DeM(14) - Turning down before break the level 0.5 which indicates that the shorters are still on power.
Trader Bozhidar Arabadzhiev
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