Today on EURUSD – Daily and H4 charts support Short trades.

On the Daily chart above, yesterday, the dollar continued its broad rally. Consequently, on EURUSD, price broke and closed below a strong support level – the most recent Daily swing low @ 1.4118 (which we’ve highlighted using the lower blue broken line). Also, though price is still within an upward channel, there seems to be room for further movement downward toward the 1.3950 area. These price actions support a bearish or downward bias.

On the H4 chart above, price has broken the most recent swing low @ 1.4130 (which we’ve highlighted using the blue broken line) downward. From a day-trade perspective, this is a good sign supporting a Short trade. The white horizontal line @ 1.4194 highlights the most recent swing high, and as long as price stays below it – in the absence of any new and lower swing high – our bearish or downward bias remains intact.

However, we still need our hourly charts – using Fibonacci retracement levels and important resistance levels – to seek promising areas to take our short positions. Price pattern on the Hourly must also be forming lower highs and lower lows; and note that our aim is to sell a rally in today’s down trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.