The pair has soared yesterday, breaching through the pivotal resistance areas of 1.6250. This incline is to threat the previous suggested head and shoulders top pattern discussed in the weekly report, but when we put the four hour time graph under the harmonic microscope, we will find that a bullish harmonic AB=CD pattern has been formed from 1.7645 to 1.5780 as seen on the image. This harmonic sequence succeeded in sending it to approach the first extended technical objective at 76.4% of CD leg. We are not completely sure if the pair will penetrate this sensitive level around 1.6365 to achieve more extended waves or it will accede to the obvious overbought sign appearing on RSI 14 as the pair always acts in response to RSI 14 in both overbought and oversold cases. Consequently, we will be neutralover intraday basisuntil we seewhether the pair will hit the initial 76.4% retracement of CD leg or the bearishness will come back into focus.
The trading range for today is among key support at 1.6075 and key resistance at 1.6550.
The general trend over short term basis is to the downside, targeting 1.4225 as far as areas of 1.6875 areas remain intact.
|Recommendation||Based on the charts and explanations above our opinion is, staying aside until a clearer sign appears to pinpoint the upcoming big move.|