Risk appetite inflates the dollar but traders remain cautious ahead of Powell
The pair extends advance on Tuesday, driven by fresh risk appetite that boosts the greenback.
Fresh rally remains underpinned by last week’s big bullish engulfing and cracked important Fibo barriers at 106.30/35 (61.8% of 107.04/105.10 bear-leg / 38.2% of larger 109.85/104.18 fall).
Daily studies are gaining positive tone (rising bullish momentum / RSI / stochastic and 20DMA turns north) and support the move.
Bulls eye 55DMA (106.63) with key barriers at 107.05/10 zone (13 Aug lower top / falling daily cloud base / 100DMA) expected to come in focus, but bulls may face very strong headwinds here.
Rising 20DMA marks pivotal support at 105.92 and break lower would weaken near-term structure.
However, traders remain cautious and may reduce exposure ahead of key event of this week– Fed chief Powell’s speech in Jackson Hole symposium.
Res: 106.63; 107.10; 107.68; 107.96
Sup: 106.18; 105.92; 105.84; 105.68