The pair stands at the front foot and probes above pivotal 200SMA (111.50) as steady Fed boosted dollar and near-term bears were strongly rejected at 111.05 on Wednesday.
Subsequent bounce formed bear trap pattern that signals further advance. Fresh recovery needs close above 200SMA to confirm reversal and mark higher low at 111.05.
Converged 10/20 SMA’s mark next pivotal barrier at 111.70, violation of which would generate further positive signal for extension towards 111.89 (weekly cloud top).
Caution on failure to clear 200SMA that would keep the downside vulnerable, with return below 30/55SMA’s (111.40/29 respectively) to further weaken near-term structure.
Bearish daily momentum adds to scenario.
Res: 111.70, 111.90, 112.03, 112.23
Sup: 111.40, 111.29, 111.05, 110.84
