Double failure at key Fibo supports weakens bears’ grip
Early Monday’s action is holding within tight range, but biased lower following weak German industrial production data (July 1.2% vs 4.7% f/c and 9.3% in June) that warns of slowdown in the sector’s recovery.
Last Tuesday’s bearish candle with long upper shadow, left after failure at 1.20 barrier and rising negative momentum continue to weigh, but last Thu/Fri double-rejection at key Fibo supports (1.1822/16) that left long-tailed daily candles, partially offset negative signals.
Near-term focus is expected to remain skewed lower while the action stays capped by 10DMA (1.1862)’ but clear break of 1.1822/16 pivots (double Fibo support, reinforced by 30DMA) is needed to signal extension of pullback from new 2020 high (1.2011) and expose next key levels at 1.1750 and 1.1700 zone.
Caution on repeated failure to break lower that would indicate that near-term bears off 1.2011 peak are losing traction, but bounce and close above 10DMA would generate initial reversal signal.
Lower volumes are expected today as the US is shut for the holiday.
Res: 1.1862; 1.1895; 1.1923; 1.1941
Sup: 1.1822; 1.1780; 1.1754; 1.1700