In the previous analysis of this pair, I predicted that after leaving the channel, we could expect declines towards the nearest support of 144.00. I also assumed a possible re-test of the broken trend line and, at the same time, the lower limit of the long-term growth channel. However, the re-test did not take place, and the quotations quite quickly and definitely took the southern direction and not only reached the mentioned support, but defeated it to set the minimum of this month at 143.20 on Tuesday, 29.05.
Tuesday’s candle marks the range of Inside Bar, today’s quotes did not exceed its extremes of 143.20 – 145.70. It is currently difficult to indicate the further direction of this pair until there is a breakout from IB to either side. However, it is worth to wait for it, because the movement that will occur after such a break may be dynamic as it is usually on this pair (apparently it is a favorite cross of hedge funds) and can have the range:
– in the case of breaking the top, the target can be the lower channel limit, i.e. about 170p
– in the case of an exit thru the bottom the nearest significant support 141.50