| Resistance: | 0.7819-37 | 0.7861 | 0.7885 | 0.7919 |
| Support: | 0.7769 | 0.7742 | 0.7720 | 0.7696 |
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Bias: I feel the 0.7919-38 area will cap for a correction back lower
Daily Bullish
The recent consolidation does make things look more clouded but considering the bearish divergences and the need to see a deeper pullback before moving to the eventual 0.80 target I feel today should prove to be a down day. There is resistance between 0.7819-37 and I look for this to cap and for a pullback lower through 0.7769 to extend to 0.7742 and probably lower. Indeed, this could keep going back to the 0.7668 low and possibly even 0.7629 before it stalls..
Medium Term Bullish
20th May: The break higher suggests we should be patient for the 0.7990-0.8028 area which I feel will cap for a deeper correction. Only an earlier drop below 0.7615 would imply an earlier decline…
Daily Bearish
Given there is no bearish divergence in hourly or 4-hour charts we have to make sure that price confirms the downside if this is to occur. The 1.5792-04 area must cap. A break below 1.5730 would encourage and extend losses to the 1.5765-75 lower congestion area at least. Only below here would offer stronger losses - minimum 1.5602 and more likely the 1.5544-86 area before higher again...
Medium Term Bearish
21st May: Only below 1.5500 would now reverse the upward picture for a deeper correction. Even then there is congestion support around 1.5450.
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For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for potential trading levels highlighted in the report are now available on the Daily Forecast page of my web site
