A bullish breakout above the previous consolidation zone between 1.2400 and 1.2800 was performed on July 15 (shown on the weekly chart).

A significant bearish rejection was observed around 1.3450. Hence, another consolidation range was established from 1.3450 down to 1.2800.

On December 7, a bullish breakout above 1.3450 (the upper limit of the recent consolidation range) enhanced the bullish side of the market. Hence, a bullish visit towards the resistance level of 1.4120 (Fibonacci Expansion 100%) was executed.

Bullish persistence above 1.4150 enhanced the bullish side of the market towards 1.4650 (141.4% Fibonacci expansion) where evident bearish rejection was expected (a bearish engulfing weekly candlestick).

The level of 1.4120 (Fibonacci Expansion 100%) remains a significant key level to be watched for price reaction during the current week's consolidations. It offered a valid sell entry on a bullish pullback that took place yesterday.

On the other hand, the price zone of 1.3370-1.3400 remains a significant support zone to be watched for valid buy entries if enough bearish momentum is maintained below the mentioned key level (1.4100) and prominent weekly support (1.4000).

Trading recommendations:

As we expected, two valid sell entries were suggested around 1.4650 (141.4% Fibonacci expansion) and around 1.4120 (Fibonacci Expansion 100%). Both positions are running in profits. S/L should now be lowered to 1.4120 to secure our profits, while the next T/P levels remain projected at 1.3800 and 1.3650.

Conservative traders should wait for a bearish pullback towards the zone of 1.3370-1.3400 for a valid buy entry. S/L should be located below 1.3320.