On the daily chart, the pair bounced off the lower MA of Bollinger Bands and corrected upwards though its growth stalled at 61.8% Fibonacci retracement. The price remains below its EMA130, EMA65 and EMA13, with the longer ones start turning down. However, the RSI failed its support at the Bullish 40 mark and is about to test it again. The Composite is slightly more oversold than the RSI and also suggests there could be an upward reverse. Contrary to indicators, their MA’s suggest a significant weakness of the market.
On the 4-hour chart, the price is falling towards the lower MA of Bollinger Bands and remains below its EMA130 and EMA65 that are directed down. The RSI is falling towards its longer MA that is in the Bullish 40-mark zone. The Composite is about to form a divergence with the price and broke down its longer MA. MA’s for both indicators suggest a strength of the market.
Support levels: 0.6530 (local lows), 0.6493 (38.2% retracement), 0.6405 (23.6% retracement).
Resistance levels: 0.6588 (local highs), 0.6640 (61.8% retracement, EMA130 on the 4-hour chart), 0.6750 (beginning of November highs).
Short positions can be opened from the level of 0.6490 with the target at 0.6415 and stop-loss at 0.6525. Validity – 1-2 days.
Long positions can be opened above the level of 0.6645 with the target at 0.6740 and stop-loss at 0.6605. Validity – 1-2 days.