Bears are pausing above key Fibo support but outlook remains negative below 200DMA
Bears are taking a breather after suffering heavy losses in past three days, sparked by panic on corona virus pandemic and BoE’s unexpected rate cut in attempts to handle the crisis.
Thursday’s close below 200DMA (1.2703) was strong bearish signal but double failure (so far) at key Fibo level at 1.2552 (61.8% of 1.1958/1.3514) suggest that bears may remain on hold.
Action below 200DMA will be seen as consolidation before bears resume, as studies on daily chart remain in full bearish setup, with clear break of 1.2552 pivot to open way towards 1.2442 (weekly cloud base) and 1.2325 (Fibo 76.4%) in extension.
Only close above 200DMA would put bears on hold for possible stronger correction.
Markets await the minutes of latest BoE meeting for further signals.
Res: 1.2928; 1.2943; 1.2993; 1.3012
Sup: 1.2552; 1.2490; 1.2442; 1.2400