The pair halted the downside move from the recorded top at 0.7634 which structured within the descending channel over daily basis, where the pair stopped at the 38.2% correction and rushed form there to the upside breaching the resistance for the channel.
The pair still lacks the upside momentum to continue the upside wave which stopped for correction, and accordingly the pair is fluctuating again around the breached resistance which turned into support at 0.7045. Fluctuating around this area formed a bearish pattern seen on the secondary image with the neckline at 0.7045 and therefore we believe that this pattern can take the pair lower again and continue the correction. Our expectations are supported by the pair trading below the 100 Days MA and the negative crossover on Stochastic supporting the likelihood to see the breach for the neckline targeting 0.6830 then 0.6695. Breaching the neckline takes the pair to retest the 38.2% correction at 0.6585 once more which might be followed with volatility for correction and then resuming the downside move towards 0.6260. In general, the expected short term trend is to the downside as far as no daily closing is seen above 0.7215.
By: Yasir Mubarak
Senior Technical Analyst