10.05.202115:38 Forex Analysis & Reviews: EURUSD bearish divergence in Daily chart

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Despite the new higher high in price of EURUSD, the RSI is not following and has provided us with the first bearish divergence in the Daily chart. This is not a reversal signal but an important warning for bulls to be cautious.

Green lines - bearish divergence

EURUSD remains in a bullish trend making higher highs and higher lows. Recently price made a strong pull back from 1.2150 to 1.1985 and is now making new higher highs. 1.1985 is crucial support that if broken will signal the end of the upward move from 1.17. It will signal the start of a pull back if not a new downward move. The bearish divergence in the Daily chart should not be taken lightly. The price range above 1.2150 towards 1.23 I believe is a good area to look for short positions with stops at 1.2350.

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