4-hour chart - Inverse head and shoulders
109.07 (inverse head and shoulders neckline)
109.34 (10-DMA + 4-hr 50-MA)
110.10 (Mar 27 low)
108.32 (support on the 4-hour chart)
107.95 (falling channel floor)
107.49 (July 21 high)
Pair’s higher low formation (Monday - 108.13, Tuesday - 108.32, Wednesday - 108.37) coupled with an oversold RSI suggests the sell-off from the March 31 high of 112.20 may have run out of steam.
However, only a break above the inverse head and shoulders neckline (on 4-hour chart) would add credence to the higher low formation and breach of the falling trend line on the daily RSI and open doors for a rally to the resistance offered by the descending trend line (seen on the daily chart) around 109.75-110.00 levels.
Watch out: Repeated failure at the inverse head and shoulders neckline followed by a bearish breakdown of the falling channel would signal the continuation of the sell-off, in which case a major support at 107.49 (July 21 high) could be put to test.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.