Forex Strategy: EUR/USD Hanging Man Suggests Declines To Continue
- EUR/USD Technical Strategy: Shorts Preferred
- Second hanging man following bounce warns of fresh declines
- Intraday gains may be limited with Hammer seeing little follow-through
The emergence of a second Hanging Man candlestick formation on the daily suggests that EUR/USD may come under renewed selling pressure. The bearish reversal pattern is made more noteworthy by its appearance near former support-turned-resistance at 1.3832. Fresh declines for the pair are likely to be met by buying support near the 1.3765 mark.
EUR/USD: Bounce Met By Hanging Man
Daily Chart - Created Using FXCM Marketscope 2.0
Drilling down to the four hour chart; a Hammer formation had warned of an intraday bounce for EUR/USD. However follow-through has been limited which suggests the signal may have been overlooked by traders given noteworthy resistance at 1.3850 is hanging nearby. A break back below support at 1.3805 could open the 1.3750 mark in the session ahead.
EUR/USD: Hammer Sees Lackluster response
4 Hour Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, FXCM
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