Where this pair is heading now?
Although the pair has retraced more than 61.8% of the large bull run from Dec2000 to Jul2008 yet I would try to analyze the pair in two possible ways – the and the ways.
Let’s take on these two cases:
1. Breakout Fakeout (BOFO) : This scenario has connotations. It is believed here that the lows made in Dec2016 and Jan2017 was just a BOFO move, which trapped the bears and has been acting as a springboard for the current rally. If this move is to continue the price has to move strongly above the Z1 (1.14646 to 1.17140), followed by weak retracement and should continue the up move. The subsequent resistance zones would be Z2 (1.24641 to 1.26004), Z3 (1.38653 to 1.39938), Z4 (1.48145 to 1.49400) and Z5 (1.57550 to 1.60380)
# Mark here that these levels are not just previous peaks but also important confluence points of various Fib. retracement levels.
2. Protraction: This scenario has connotations. Here the pair may try to cross Z1 but faces strong resistance, traps the bulls, continues the down move and breaks the Jan2017 lows of 1.03402. The support may come at 0.96081. The price in this case may settle anywhere between 0.83531 and 0.96081 before a pull back.
Please note that these view are personal and purely technical in nature (without any fundamental bias). Refer smaller time frames for better entries and exits.
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Zone 2 should be the target in next upmove.
Scenario 1 worked perfectly.