FX.co ★ Intraday technical levels and trading recommendations for EUR/USD for November 10, 2014

A bullish engulfing daily candlestick emerged off price level of 1.2500 one month ago. A resulting bullish movement towards 1.2850 was contained within the depicted channel.

The upper limit of the movement channel (1.2880-1.2900) was targeted. However, bearish pressure was applied earlier around 1.2800-1.2840.

A bearish breakout off the bullish channel took place shortly after, thus confirming a Flag continuation pattern. Initial daily target level was located around 1.2490.

Since no fixation above 1.2760-1.2780 took place on a daily basis, the EUR/USD pair remained under bearish pressure.

Now we can see another possible continuation pattern. Continuation of Head and Shoulders pattern to be watched on daily basis. 

Daily fixation below 1.2490 (the origin of the previous bullish swing expressed one month ago) theoretically extends the bearish targets towards price level of 1.2200. 

The market expressed quite strong bearish momentum that went further below the lower limit of the previous bullish channel.

As depicted on the chart, the EUR/USD pair has been respecting the limits of the current bearish channel so far.

As anticipated, price levels around 1.2750 (upper limit of the channel) provided a valid SELL entry. Quick decline took place towards price level of 1.2460 (the origin of the most recent bullish movement).

Recommendation:

As anticipated, daily closure below 1.2480 offered another SELL signal for risky traders.Target levels were located at 1.2440, 1.2370 (already reached) and 1.2290 ( wasn't hit yet ).

Another SELL entry was offered at retesting of the recently broken DEMAND zone at 1.2450-1.2500 ( also corresponding to the upper limit of the channel ). 

Stop loss can be set as a daily closure above 1.2520.