Daily Pivots: (S1) 108.55; (P) 108.81; (R1) 109.12; More…
A temporary low is in place at 108.49 with today’s recovery. Intraday bias is turned neutral first. On the downside, below 108.49 will target 107.77 support first. Break there will confirm completion of rebound from 104.69 at 110.00. Then, further decline would be seen back to retest 104.69 low. On the upside, break of 110.00 will extend the rebound. But we’d expect strong resistance from 61.8% retracement of 114.54 to 104.69 at 110.77 to limit upside.
In the bigger picture, while the rebound from 104.69 is strong, there is no change in the view that it’s a corrective move. That is, fall from 114.54, as part of the decline from 118.65 (2016 high), is not completed yet. Break of 104.62 will target 100% projection of 118.65 to 104.62 from 114.54 at 100.51, which is close to 100 psychological level. Nevertheless, sustained trading above 55 day EMA (now at 110.82) will dampen this bearish view and turn focus back to 114.54 resistance instead.
