Daily Pivots: (S1) 1.1722; (P) 1.1753 (R1) 1.1804; More…
A temporary low is in place at 1.1908 and intraday bias is turned neutral first. Stronger recovery could be seen but break of 1.1908 is needed to confirm up trend resumption. Otherwise, more consolidation would be seen with risk of another decline. Below 1.1688 will target 38.2% retracement of 1.1119 to 1.1908 at 1.1606. At this point, we’d expect strong support from 1.1606 to bring rebound. But sustained break of 1.1606 would bring deeper pull back to 61.8% retracement at 1.1420.
In the bigger picture, an important bottom was formed at 1.0339 on bullish convergence condition in weekly MACD. Sustained break of 55 month EMA (now at 1.1760) will pave the way to key fibonacci level at 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. While rise from 1.0339 is strong, there is no confirmation that it’s developing into a long term up trend yet. Hence, we’ll be cautious on strong resistance from 1.2516 to limit upside. But for now, medium term outlook will remain bullish as long as 1.1295 support holds, in case of pull back.
