On December 30, significant bearish rejection existed around the level of 0.6840 (daily resistance level) similar to what happened previously on October 23.
Moreover, a daily closure below 0.6750 allowed a quick bearish decline to occur initially towards the level of 0.6500, which was broken-down as well.
The depicted chart illustrates a double-top reversal pattern. The depicted support level at 0.6430 should be broken-down in order to confirm the reversal pattern.
However, traders should note that the level of 0.6430 constitutes a significant support level which corresponds to the backside of the broken downtrend line depicted on the chart. Hence, a strong bullish rejection and a valid buy entry should be expected.
On the other hand, an obvious bearish closure below 0.6430 opens the way towards 0.6250 where multiple previous bottoms are located.
The material has been provided by InstaForex Company – www.instaforex.com