Bias: The 129.40-50 area must cap to retain a bearish stance for a move back to 127.38 else expect a larger recovery
Loss of 129.93 certainly had its impact and overall this does look bearish. However, given the turbulence this morning it is easy to react too quickly. Certainly there is now resistance at 129.40-50 and only a break above this area would seem to have any potential for a stronger push higher. This will need either EURUSD to break back above 144.75-00 or USDJPY above 90.04-36. If seen then we should then look for follow-through. However, be prepared for some choppy consolidation also. Above 129.50 suggests a recovery through 130.00 and into the 130.40-77 resistance. Take care there. Then note further resistance at 131.59, 132.50 and 133.38.
18th December: Price has been a bit crazy - but wait for a break above 129.40-50 to see follow-through for 130.40-77, 131.59, 132.50 and the 133.38 area.
Losses were sharp and again this morning. The only concern is that we seem to have seen a spike bottom and therefore I'm not sure whether we can expect additional losses today apart from a correction. While 129.40-50 caps and we get a move back below the 128.75 pivot area the risk will be for losses to extend to 127.99 and possibly closer to this morning's 127.38 low. I'd expect a correction from around this area. Below is the 126.87 low and also 126.50. Also note lower support at 125.81.
18th December: If this breaks the 126.87 low the implication would seem quite bearish.
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