Good morning,
So EUR has completed our target for this week at 1.1850 and now we could say that daily englufing is completed as well. What's next?
Despite upside action was pretty nice, daily chart shows very strong bearish momentum. It means that upside action hardly will be continued without meaningful retracement. Second - this retracement probably should be deep. Actually I will not surprise if we will get double bottom here.
Finally - EUR has to keep recent lows to hold chances on action to 1.20-1.21 area and, correspondingly, keep valid our H&S weekly scenario:
4H chart shows few levels that market could reach on retracement. First one is re-testing of neckline of our H&S pattern. Although chances are small, but not zero that EUR re-test neckline and proceed higher, to XOP and ultimate H&S target at 1.1906. How to take position on this scenario without any big risk?
I think we could use second setup here - B&B "Buy". Take a look that final part of upside action is nice DiNapoli thrust and price already below 3x3 DMA. This is setup for B&B "Buy":
B&B is more than welcome right now, because it lets take position on scenario with low probability without great risk. B&B probably will start from 1.17 - Agreement and K-support area on hourly chart. When 5/8 action will be over and B&B will hit its usual target - you could close1/2 of your position and keep the rest with hope that upside action somehow will continue: