Bias: I feel the 90.62-96 area is going to be crucial
Clearly yesterday was not anticipated… It does open up a larger downside risk should the 88.13-21 lows break. There are a variety of possible complications and therefore it may be better to sit out and observe. If the upside extends further then the 90.62-96 area looks critical to me and I feel it will probably hold. If so then a renewed attack on yesterday's 88.97 low would be expected and after a pullback we should be watching for a test of the 88.13-21 corrective lows. Breach extends losses to 87.51-74 and possibly 87.05 (max 86.76 - dependent on where this correction stalls.)
If we see direct losses then take care around the 88.45-65 area which could force the correction to recycle. Only directly above 91.00 would revert back to a more bullish structure but possibly still within range. There is pivot resistance around 91.53 and above there retracement resistance at 92.07 & 92.53 en route the 92.95-05 area.
Medium Term Outlook:
21st May: The immediate bullish structure has been broken and maybe at risk of a larger reversal lower… However, wait for confirmation by a break of 88.13-21. Back above 91.00 would bring some stability back but possibly within a consolidation…
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