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Facts:
- MACD trends lower after bearish crossover with bearish divergence occurring on RSI
- Potential double top formation has occurred which can lead to trend reversal
- Target at 61.8% Fibonacci retracement level has previously acted as support which now might be retested as resistance
- FOMC became more hawkish
Recommendation:
- Transaction: Short position on EURUSD at the market price.
- Target: 1.06592
- Stop: 1.09806
Opinion:
EUR/USD is on the brink of a trend reversal after forming a double-top pattern. The MACD is trending lower following a sell signal (bearish crossover), while the RSI remains in bearish divergence despite the currency making a higher high. A stop-loss is set above the previous high, which would invalidate this thesis. The take-profit target is at the 61.8% Fibonacci retracement level, which has previously acted as support. Additionally, the FOMC has recently adopted a more hawkish stance.
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