The Euro is in red in early Wednesday’s trading and holding below 1.2000 barrier, entrenched within 40-pips range in Asian session.
Extension of strong three-day bullish acceleration from 1.1773 trough peaked at 1.2070 on Tuesday, but probe above psychological 1.2000 target proved to be short-lived, as close of Tuesday’s trading occurred below 1.2000 handle after traders booked profits.
Risk of deeper pullback is rising as Tuesday’s action ended in red Doji with long upper shadow and fresh easing on Wednesday threatens of forming reversal pattern on daily chart.
In addition, daily RSI is turning south after touching o/b zone border line while slow stochastic reversed from overbought territory, showing a plenty of room at the downside.
The price is focusing pivotal supports at 1.1910/00 zone (former top of 02 Aug / Fibo 38.2% of 1.1662/1.2070 upleg / base of ascending hourly cloud which was penetrated on extension of pullback).
Sustained break here would signal deeper pullback and put immediate bulls on hold.
However, overall bullish structure favors fresh upside after correction, with extended pullback expected to hold above 1.1818 (Fibo 61.8% of 1.1662/1.2070 upleg / rising 20SMA).
Res: 1.1984, 1.2000, 1.2070, 1.2101
Sup: 1.1941, 1.1910, 1.1850, 1.1818
