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Morning Star Reversal

  • RES 4: 1.1421 High Jan 18
  • RES 3: 1.1366 Bear channel top
  • RES 2: 1.142 50-day EMA
  • RES 1: 1.1293 20-day EMA
  • PRICE: 1.1240 @ 06:11 GMT Feb 1
  • SUP 1: 1.1121 Low Jan 28 and the bear trigger
  • SUP 2: 1.1070 Low May 29, 2020
  • SUP 3: 1.1026 Bear channel base drawn from the Jun 1 2021 high
  • SUP 4: 1.0976 2.00 proj of the Jan - Mar - May 2021 price swing

EURUSD started the week on a firmer note and has recovered from Friday’s low. Yesterday’s daily close highlights a 3-day Japanese candle reversal known as a morning star. This suggests scope for a stronger short-term corrective bounce ahead of the next firm resistance at 1.1293, the 20-day EMA. The broader trend direction remains down though following the recent break of support 1.1186, Nov 24 low. The bear trigger is at 1.1121.

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