A Significant Support on EUR/USD Failed 💣

Support on EUR/USD got breached
Let’s first start with looking at a Daily chart of EUR/USD. There has been a pretty significant development!

Significant support (from Daily time frame) got breached and now it seems that lower prices (below this support) are being accepted. This would mean that this support will become a resistance.

Currently, it is still a bit fresh, but if EUR/USD really closes this week below this support (which it already breached), then it will be a strong signal that a new resistance got formed and that strong sellers are taking over.

Check out the picture to see what I have in mind. It is a Daily EUR/USD chart...

As you can see from the picture above, there were many strong rejections of this support in the past. I marked them in the chart.

Yesterday, the Daily candle closed below all those rejections and today’s current development gives a chance that today’s daily candle will close even lower, confirming that the support became a resistance.

Let’s have a look at a lower time frame
It seems that we have a strong resistance zone, but where EXACTLY to enter a short trade?

In situation like this I often switch to lower time frames, preferably a 30 Minute time frame.

Then I use the Volume Profile and I look for significant volume area to go short from.

In this particular case, the zoomed-in situation around the new daily resistance looks like this (30 minute chart, EUR/USD)

Bingo! Now we have an exact level (1.0999) from which we can go short from! We can go short with an intraday quick trade as well as with more long-term swing trade!