Corrective dips into 1.20 support zone to precede fresh advance
Bulls are taking a breather under new 2 ½ year high (1.2177) following last week’s 1.34% advance. Weekly close above key levels at 1.2000/1.2096 (psychological / Fibo 38.2% of 2011/2017 1.4938/1.0340 fall) as well as 1.2100 barrier, generated strong bullish signals, but overbought daily RSI / stochastic and weakening bullish momentum signal that consolidation / correction is likely to precede fresh rally.
Initial supports lay at 1.2100 zone (round-figure support / last Thursday’s low / base of thick hourly cloud) guarding more significant levels at 1.2041/16 (Fibo 23.6% of 1.1602/1.2177 / rising 10DMA) and psychological 1.2000 support, where strong bids are concentrated.
Dip-buying above 1.20 zone remains favored for fresh rally towards Fibo projections at 1.2263 and 1.2323.
Alternative scenario sees loss of 1.20 zone as initial bearish signal, which would be boosted on break below last week’s low at 1.1922.
Res: 1.2140; 1.2177; 1.2200; 1.2263
Sup: 1.2100; 1.2041; 1.2016; 1.2000