The spot rate approaches the intermediate support of its medium-term bearish channel at 1.6080 suggesting a rebound. However, a break of these levels will enable the lower limit of its channel at 1.6030.
Technical indicators provide buy signals and until the support is not broken, the assumption of a rebound is most likely. Bollinger bands are much discarded as a result of a strong increase these days. Stabilization is expected in a short-term.
The spot rate is currently testing the intermediate support of its channel, we suggest 2 scenarios: the first one is the hypothesis of a rebound where we recommend a buy on the level of 1.6080 with the 1st objective at 1.6140 and then at 1.6160. A breakthrough of 1.6060 will invalidate this scenario. The second scenario is a break of its support where we recommend a “sell stop” which means selling the spot rate as soon as it is broken through its support of 1.6080 with the 1st objective at 1.6020 and then at 1.6000. A breakthrough of 1.6100 will invalidate this scenario.
