Attached is the 4H chart for EURUSD. This pair has had a very good drop over the past few hours and this throws up an interesting picture now as to the future direction of this pair. So far this week, this pair had appeared highly bullish and it had threatened to finally break out of its big range of 1.38 to 1.42-1.43.
In fact, it had refused to fall down and had started to break through several resistances which showed that this pair was being highly bullish and led everyone to believe that we might finally see a break of previous highs and then move on to 1.45. But now, the situation seems to have changed totally and this pair has now broken through its strong support at 1.4160.
As you can see from the chart, this break had also been in a very long bar which tells you that this break could be a clean and true one. If the break had occurred on a small bar, then it most likely would have been a false break but the fact that it has occurred on a long bar shows that it could be a true break.
This pair has now entered into a congestion zone which extends till 1.4100 which means that the move down would be slowed down a bit. For today, i expect the price to make a small retrace to 1.4160 or 1.4180 and then continue the fall. A break of 1.4100 would accelerate the fall and then we could see the pair slowly moving down to 1.4050 and then 1.40. Back into Range !!
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