This is a prime example of a rounding top reversal at a solid previous . The price has been in an uptrend for the past 2 months and has been rounding off since the beginning of May. The flattening of the uptrend was clearly visible from the divergence (we could see the higher highs on the price chart diverging from the lower highs on the indicator). At this point, the price has begun to make lower highs and while the price is currently still ranging, the bears seem to be getting more and more in control. The price is moving lower as a result.
What needed to happen for me is two things: the price needed to break through the upwards (the black line) and also needed to close below a local (the blue-ish horizontal ). We broke the and are now very close to breaking that local support as well. If the price manages to close at the lows of that , it would also be a very nice example of a pin and drive entry trigger (marked in orange).
Potential economic news releases to keep in mind are the SNB interest rate decision tomorrow and the BoJ interest rate decision on Friday.
This and other setups are described on my website, where you can find my weekly forex outlook.
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