The spot rate approaches the intermediate resistance of its medium-term bullish channel at 115.30. It seems that a decline was initiated. However, a break of these levels will free a large potential and reach the upper limit of its channel at 116.70.
Technical indicators do not provide clear signals, but until the resistance is not broken the assumption of a decline is most likely. Bollinger bands have stabilized showing a more regular volatility.
The spot rate is currently testing the intermediate resistance of its channel, we suggest 2 scenarios. The first one is the hypothesis of a decline where we recommend a sell on the level of 115.30 with the 1st objective at 114.70 and then at 114.50. A breakthrough of 115.50 will invalidate this scenario. The second scenario is a break of its resistance where we advise a “buy stop” which means to buy the spot rate as soon as it is broken through its resistance of 115.30 with the 1st objective at 115.90 and then at 116.10. A breakthrough of 115.10 will invalidate this scenario.
