On the daily chart below, we can see that the price is getting near the neckline of the possible double top formation at 1.2444. The divergence between the two tops and the MACD increases the odds of the pattern working out. The neckline at 1.1839 for now is the natural target and a clear break lower would open the door for a possible fall to 1.1250.
The moving averages are pointing south and the red long period moving average acted as resistance along with the 1.2265 level. As long as the moving averages maintain the bearish bias, we can expect the price to break the neckline
On the 4 hour chart below, we can see that the selling momentum is fading. The price is moving lower very slowly, probably waiting for some fundamental catalyst as the market is still uncertain on what’s next. Remember that good news is bad news now for the pair. We can see there’s another divergence, which in this instance can signal a pullback to the trendline before another push lower
On the 1 hour chart below, we can see that there’s a possible inverted head and shoulders pattern, which would have the trendline as target. That looks good if everything lines up this perfectly. Buyers will need to wait for a breakout of the neckline though before finding conviction for a rally.
The moving averages are still tilted lower and it would be another extra confirmation for the buyers if they tilt higher. For the sellers, the 1.20 handle is key in the near term. A clear break below and the selling momentum should resume till the neckline at 1.1839. Otherwise, we should start to see them piling in at the trendline.
