The dollar regained traction and rallied on Friday after Fed injected liquidity and improved the sentiment. Fresh advance surged through important Fibo resistance at 105.40 (38.2% of 112.22/101.18) which limited the action in past three days and round-figure 106 barrier, improving near-term outlook. Daily indicators are heading north and showing room for further advance, with minimum requirement for bullish signal seen on close above 105.40 and 105.76 (10DMA). Extension and close above 106.70 barrier (50% retracement/daily Kijun-sen, which is currently under pressure) would further boost near-term action and expose next key levels at 108.00 (Fibo 61.8% and 108.24 (200DMA). Broken Fibo 38.2% level now offers key support at 105.40 and near-term action is expected to maintain bullish bias while holding above this level. The pair is also on track for positive weekly close after two weeks of strong losses (big bullish weekly candle with very long tail) that adds to positive outlook and keeps risk of testing psychological 100 support on hold.
Res: 106.70, 107.00, 107.74, 108.00
Sup: 106.00, 105.76, 105.40, 105.00
