The pair closed in red for the fourth straight day and came close to key near-term support at 1.0550 (daily cloud base). Yesterday’s comments from Fed’s Chief Yellen about interest rate hike, further boosted strong dollar’s near-term sentiment and kept the pair under increased pressure.
The notion is confirmed by the second daily close below 55SMA (1.0601), strong bearish setup of daily MA’s, as well as bearish candles with long upper shadows of past two days that weigh on near-term action.
Final attack at 1.0550 target is seen as likely scenario, with break lower to look for another pivotal support at 1.0525 (Fibo 61.8% of 1.0339/1.0827 rally).
Strongly oversold slow stochastic is still heading south and showing room for further downside.
Broken 55SMA marks solid resistance at 1.0601, along with daily Kijun-sen at 1.0640, where upticks should be ideally capped.
Res: 1.0584, 1.0601, 1.0640, 1.0662
Sup: 1.0550, 1.0525, 1.0509, 1.0454
