‘While the dailies still point lower, the 4 hour charts are recovering after having become oversold and further short term gains would not surprise. On the downside, minor support will be seen at 111.00 and 110.70 ahead of the session low of 110.23.’ – Jim Langlands, FX Charts (based on FX Street)
Pair’s outlook
Yesterday, the US Dollar managed to regain some losses after the massive plummet on Wednesday. However, it seems that traders are once again looking in the direction of the save-haven currency. The nearest support formed by the weekly S2 at 111.41 may hinder the rate from trading lower; however, it may not be strong enough to halt it, thus leading the pair to the 111.30 territory. In case the Greenback manages to push north, a penetration of the 100-day at 111.77 might indicate that the currency has finally recovered from the latest political turmoil. This scenario is confirmed by bullish short-term technical indicators.
Traders’ sentiment
Market sentiment remains bearish, as 56% of open positions are short. Meanwhile, 51% of pending orders are to buy the US Dollar.
