Cable hit support line (march low) few days ago – the exact place where we can find a demand zone. In the mid-term we are still in uptrend, which is currently being revised, mainly on the wave of unfulfilled BoE expectations, as well as improvement of economic situation in US.
Thus, decline may end up soon, of course if bulls will find enough strength and reasons to continue on bids. Downward move may last much longer than investors expect – as geometry of last downward-upward-downward waves can indicate (in conjunction with the long-term support/resistance levels).
On the lower TF, we see price consolidation around the last week low, which was probably caused by lack of new fundamental impulses, as well as demand zone 1.6530-1.6470. Pair slides on the downward channel lower band for 7 days in a row and has got plenty of room to rebound to one of below levels:
- 1.6600 – upper bound of consolidation (after last 4 days highs),
- 1.6650 – supply zone from August 20,
- 1.6680 – high from August 20.
The above analysis is one in a series of analyzes prepared by Comparic team in collaboration with XM broker. Other analyzes can be found every day on XM’s site. Open real XM account or try DEMO version for free. Promotion – 30% bonus up to $10,000!
