The cross fell back below daily cloud on Tuesday after dovish comments from BoE’s Carney. Penetration into daily cloud (spanned between 141.85 and 144.07) and probe above 142.27 (Fibo 38.2% of 148.28/138.66 downleg) was short-lived and generated initial signal of stall.
Thick daily cloud weighs on the pair, along with bearishly aligned technical studies (20/55 SMA bear cross was formed at 142.18 yesterday) and uncertainty at the beginning of Brexit talks.
Fresh bearish acceleration through 100SMA (141.23) and 10SMA/Fibo 38.2% of 138.66/142.54 upleg (141.06) further weakens near-term structure, with daily Tenkan-sen (140.71) coming under increased pressure.
Daily close below 141.06 will be seen as strong bearish signal, while firm break below Tenkan-sen would generate initial signal of an end of corrective phase from 138.66.
Res: 141.23; 141.48; 141.85; 142.27
Sup: 140.71; 140.34; 140.14; 139.58
