Consolidation in the medium term and price at the top near the previous high gives us grounds to look for short positions in the area below 61.8 Fibo of the last downward movement. SL must be set at 0.8740.
Levels of horizontal resistance and 9th bar from DeM Sequential reinforce the probability of an impending downward impulse.
Often, when a 9 consecutive bar of Sequential is formed, it is followed by a strong impulse in the direction of the last movement (in this case above the last local peak) and a sharp opposite impulse.
DeM (14) turns down in an overbought market above 0.7 – negative signal.
Alternative scenario: Breaking the price above 0.8720 and holding at least 1 whole D1 bar above these levels will confirm the likely formation of an uptrend after activating a double bottom formation.
Trader Nikolay Georgiev