The 38.2% held against the last two attempts to decline and pushed the pair to the upside to remain within the bearish correctional channel over daily basis above. The pair inclined to breach the 100 Days MA and now trading near the critical resistance around 0.7145-0.7160, where this level represents the neckline for a bullish pattern which increases the likelihood for the pair to continue moving higher over short term basis and then continue the downside correction and return to the general upside wave the was stopped previously.
Momentum indicators are providing overbought signals which is further restricting the breach; nonetheless, according to the above mentioned facts and the stability above the 38.2% correction and the 100 MA we see the likelihood for the pair to continue to the upside breaching the neckline targeting areas ahead around 0.7320. .This move will be accompanied by high volatility and fluctuations which then will be capable of taking the pair higher towards 0.7630. .The short term bullishness remains valid as far as 0.6790 remains intact which will take the pair lower towards 0.6400 areas.
By: Yasir Mubarak
Senior Technical Analyst