As expected, E$ managed to hold 1.3260/70 on first test and rebound to a high of 1.33248 before plunging sharply to print the day's low of 1.3256 where it found strong bids. What made yesterday's session so interesting was the fact that a US investment bank (wink, wink) was the notable seller!! so much for 1.3700 but they still walked away with 300ish pips profit all within a week's work :)
Asian order book is getting busy:
Stop loss: 1.3200, 1.3235, 1.3250/45, 1.3330/50
Limit: 1.3200 (large opt expiry) and 1.3330
This morning, E$'s 2nd attempt at the 1.3330/40 resistance fell short at 1.3315 and was then sold off. This should keep E$ within the range of 1.3350/60 to 1.3320/30 through Asian to early Ldn session. However, intraday momentum is starting to turn from consolidation to down which has increased the probability of the lower band being broken with E$ falling to test the eventual target of 1.3200/10 as mentioned in my update yesterday. I foresee this happening probably during the Ldn/NY session. In the chart below, you would have noticed the red line (~1.3165) where you should understand the rationale of why I highlighted. Though I see 1.3190/200 to hold for a subsequent rebound to 1.3400, I am mentally prepared for the possibility of an overshoot (news induced) to 1.3165 but this level should hold for this round.
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| E$ 8hourly chart - Fibonacci retracement ratio |
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