The pair edged higher in Asian trading on Friday, in extension of previous day’s rally and probing the upper boundary of three-day congestion at 109.80, reinforced by sideways-moving daily Tenkan-sen and falling 20SMA.
Daily technicals in firm bearish mode do not see stronger prospect for more significant recovery on firm break above 110.00 for now, but formation of reversal pattern on weekly chart, following repeated downside rejections at weekly cloud base (108.80), could be seen as initial bullish signal.
However, near-term direction would be likely defined by the tone of Yellen / Draghi’s speeches at Jackson Hole later today.
Firmer bullish signal could be expected on sustained lift above 110.00 barrier which would expose next breakpoints at 111.00 zone, while increased risk of continuation of larger downtrend from 114.49 (11 July peak) could be expected on firm break below weekly cloud base.
Res: 109.77, 110.00, 110.40, 111.00
Sup: 109.49, 109.15, 108.84, 108.60
