Short Term Technical Analysis for Majors (07:00 GMT)
Bears took control of the near-term outlook, as the pair failed to sustain gains above 1.2800, 200 day MA and fell sharply to 1.2735, Monday’s opening levels. The reversal, signaled by Doji candle, retraced over 50% of 1.2660/1.2828 recovery rally. Hourly indicators are deeply in the negative territory and 4h chart studies building bearish momentum that keeps near-term focus at the downside. Strong support zone lies at 1.2720/00, Fib 61.8% / tentative bull trendline off 1.2660 and daily Ichimoku cloud base, seen as next downside target. Immediate resistance stands at 1.2764, yesterday’s low, ahead of 20/55 day EMA’s at 1.2785 and key near-term barriers at 1.2800/28.
Corrective rally off 1.5826, 15 Nov low, was capped by daily Ichimoku cloud base at 1.5935, with subsequent dip to 1.5882, retracing 505 of initial 1.5826/1.5935 rally. This could be seen as corrective, as 4h studies still hold in the positive territory and hourly indicators start to point higher, after breaking below their midlines. However, regain of 1.5935 is required to confirm higher low and resume near-term recovery, towards 1.5959, Fib 38.2% and 1.6000, round figure / trendline resistance. On the downside, violation of 1.5868, Fib 61.8%, would put near-term bulls on hold.
Near-term bulls remain fully in play, as the pair resumes rally that was interrupted by 81.00/58 consolidation and breaks above our initial target at 82.00. Immediate upside target lies at 82.20, May highs and 83.32, weekly 150 day MA, to possibly open way towards psychological 83.00 barrier. However, overextended conditions on both, 1 and 4h chart, with appearance of 4h RSI /MACD bearish divergence, could limit gains in the near-term. Previous high at 81.58, offers initial support, ahead of 81.00, consolidative range floor that should contain any stronger reversal.
Bounce on failed attempt to break below important 0.9400 support, also 200 day MA, provides temporary relief, as the price jumps to 0.9456 so far. Retracement of over 61.8% of 0.9489/0.9390 fall, turns hourly structure positive, however, failure to regain previous high at 0.9489, would risk lower top and fresh weakness, as 4h indicators still hold in the negative territory. Break above 0.9489 to re-focus key near-term barriers at 0.9500/11, otherwise, near-term focus would shift back towards 0.9400.
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