The pair extends recovery to new over one-week high as dollar remains inflated by global recovery concerns, keeping risk aversion in control.
Slight recovery of European stock markets failed to improve sentiment, keeping the greenback at the front foot.
Wednesday’s 0.5% rally generated positive signals on formation of bullish outside day and close above Fibo 23.6% of 109.85/106.07 (106.96).
Fresh advance emerged above daily cloud which twisted today and starts to ascend and thicken, providing support for recovery rally.
Fresh bulls eye key obstacles at 107.51 (Fibo 38.2%) and 107.59/62 (converged 30/20DMA’s), with close above here expected to generate stronger bullish signal for extension of the rally and expose barriers at 107.96/98 (Fibo 61.8% / falling 100DMA).
Caution on conflicting daily studies (negative momentum / rising stochastic / mixed MA’s) which lack clearer signal.
US GDP / Jobless claims and durable goods orders data would provide fresh signals.
Res: 107.51; 107.62; 107.96; 108.40
Sup: 107.06; 106.96; 106.57; 106.38