The pair stands at the back foot on Wednesday and probes again below 109.27 support (lows of Fri/Mon), after Tuesday’s tick below was short-lived.
Downside pressure is maintained by full bearish setup of daily MA’s and thick weekly cloud, but rising momentum and deeply oversold stochastic conflict and suggest that bears may face strong headwinds from key support 109.02 (13 May low) which was approached on today’s dip to 109.15.
Despite holding in red for the second day, as fresh risk aversion boosts safe haven yen, the pair looks for clearer direction signal.
Violation of 109.02 pivot would generate bearish signal for continuation of larger downtrend towards target at 108.50 (Fibo 50% of 104.59/112.40 / 31 Jan low).
Conversely, lift above initial barrier at 109.40 (5SMA) would expose 109.60 (tops of Fri/Mon) and upper pivot at 109.77 (10SMA).
Res: 109.40, 109.60, 109.77, 109.98
Sup: 109.15, 109.02, 108.72, 108.50
