The pair is holding around 110.00 handle as trading narrows ahead of US NFP data.
Yesterday’s strong upside rejection at 110.66 (Fibo 38.2% of 114.49/108.26 descend) and close in red daily candle with long upper shadow signaled that bulls, attracted by daily cloud twist, ran out of steam and taking a breather.
Today’s action was so far contained above strong support at 109.75 (4-hr cloud top / 20SMA / Fibo 38.2% of 108.26/110.66 upleg) and bullish sentiment is expected to remain firm while the latter support holds.
Otherwise, sustained break lower would generate initial signal of lower top and spark fresh weakness.
US jobs data are likely to spark stronger activity, with bullish release to boost the greenback through key barriers at 111.00 (former high) and 111.17 (converged 55/100SMA).
Alternatively, loss of 109.75 handle would expose 109.46 (daily Tenkan-sen) and signal an end of corrective phase from 108.26 on sustained break lower.
Res: 110.21, 110.66, 111.00, 111.17
Sup: 109.75, 109.46, 109.18, 108.83
