The Chart of the Week: EUR/USD enters the bear's lair

EUR/USD on the brink of an upside correction on the lower time frames before resuming medium-term downtrend.
Monthly demand below the market would be targetted before the resumption of the longer-term uptrend.

EUR/USD has been rejected from the monthly support in a correction of the monthly bullish impulse. With some more work to do below the structure, the bears have the upper hand, albeit potentially only momentarily.

The following is a top-down analysis from which deciphers where the next bearish opportunity could evolve before the resumption of the uptrend.

Monthly charts

The monthly chart has corrected to a 38.2% Fibonacci retracement level, but there could still be some more room to go until the correction meets prior resistance.

In doing so, there will be a bearish prospect on the lower time frames before the bulls take back control.

As ca be seen, the bulls are already outside of the long-term bearish channel.

Weekly chart

The weekly charts show that the price is now below an important resistance structure.

In a continuation on the lower time frames to the downside for the week ahead, the chart will be forming a weekly overextended M-formation.

Daily chart

The weekly price action would enable a retest of the daily structure before the downside continues.

4-hour chart

The price on the 4-hour chart is overextended and due for a correction. Bears will wait for the price to correct before seeking an optimal entry to target monthly demand.

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