EUR/USD has been bearish in July, reversing June's bullish correction rally. Actually, when looking at June's price action until now, we basically see a sideways market. But the prevailing trend was a bearish one since May, when it established the 2014-high. So with this bearish to neutral mode, how do we interpret the RSI at oversold condition and price near support? Well, with price in the 1.35-1.3520 area, and RSI oversold, we can expect some short-term bounce within the bearish-neutral mode. The mode was simply neutral, we can probably give more confidence to a bounce back toward the 1.37 high on the month. But, with some bearish bias, we should monitor the 1.36-1.3620 area. (eurusd 4h chart 7/17)1) 1.3575 was the neckline of a broken head and shoulders pattern. Now it might provide resistance if the market is indeed bearish. 2) The next line of defense will be around 1.36, and the falling July trendline. 3) Above 1.36, the market might be signaling that it is respecting the 2014-low. Then, the focus could shift from the lows on the year to July's 1.37 high. If we give it some elbow space, we should probably put a stop-loss just above 1.3620, because above that price would have crossed over the moving averages, reducing the confidence for the bearish outlook even more.4) Also note that if the market is turning bearish, the 4H RSI should hold below 60. Thus if price is near resistance and the RSI is stalling around 60, look for a bearish continuation attempt to follow.Trade Set up:Let's consider one scenario: shorting around 1.3585, with a stop at 1.3625, and target of 1.35.This trade offers a potential reward of 85 pips while the risk at stop-loss would be 40 pips. This would be just above 2:1 reward to risk ratio, which classifies this trade profile as slightly attractive. Note that if the trade does work out toward 1.35, it would also be adding another bearish continuation signal, and the 1.3475 would be exposed, giving us more potential reward.