The Euro benefited from Fed action and advanced 1.2% since opening in Asia, as renewed optimism boosted risk appetite. Fresh bulls broke out of two-day congestion, formed above new three-year low and generated initial positive signal on break above past two day’s highs (where strong upside rejections occurred) and Fibo barrier at 1.0838 (23.6% of 1.1494/1.0635 fall), focusing on next barrier at 1.0901 (falling 10 DMA). The action is supported by rising daily RSI which formed bullish divergence, stochastics’ emerge from oversold territory and rising momentum, while 5DMA turned sideways. Bulls need close above 10DMA to confirm positive stance and expose 1.0963 (Fibo 38.2%), but will face a tough work as a cluster of daily MA’s between 1.0977 and 1.1082 (30/55/100/20/200DMA) marks very strong barrier. Also, traders look for a verification of Fed’s latest measures in the Congress that would further improve the sentiment and boost Euro. Broken Fibo 23.6% barrier now reverted to initial support (1.0838), guarding 5DMA (1.0736), loss of which will neutralize bulls.
Res: 1.0878, 1.0901, 1.0963, 1.0977
Sup: 1.0838, 1.0800, 1.0775, 1.0736
