Testing of the dynamic resistance 1.2755 region (middle Bollinger band) drove yesterday to forming of reversal pinbar. Given that long-term trend is still downward, this setup can become a good trigger for new wave of decline in direction of the lower Bollinger band (1.2491).
We note a strong local support, that most likely will hold the bears for a while. It’s 1.2615 (lower Bollinger band).
We can denote an offer zone at the 1.2720 level, that was formed by bearish pattern O&U. Thus it’s likely, that market will retrace to this zone before the main phase of decline.
As we see ADX is not so active, therefore an upward bounce may take place from the lower Bollinger band (1.2660).
Main scenario: Touch of 1.2660, then upward pullback towards 1.2720 and after that the main phase of decline will be triggered in direction 1.2615. Such scenario may need the room beyond one day.
Alternative scenario: Decline towards 1.2615 without prior correction.
Longs from 1.2660 towards 1.2720.
Shorts from 1.2720 towards 1.2615.