The spot rate is currently testing the upper limit of its long-term bearish channel at 1.6150 suggesting a decline. However, a break of these levels will initiate a violent bullish channel.
Technical indicators provide sell signals and, until the resistance is not broken, the assumption of a decline is most likely. Bollinger bands are much discarded as a result of a strong decline these days. Stabilization is expected in a short term.
The spot rate is currently testing the upper limit of its channel, so we recommend 2 scenarios: the first one is the hypothesis of a decline, then we recommend to sell at the level of 1.6150 with the 1st objective at 1.6090 and then at 1.6070. A break through 1.6170 will invalidate this scenario. The second scenario is a break of its resistance, then we recommend a “buy stop”, which means to buy at the spot rate as soon as it has broken through its resistance of 1.6150 with the 1st objective at 1.6210 and then at 1.6230. A break through 1.6130 will invalidate this scenario.
