As it was expected, the currency exchange managed to break below both the psychological 113.00 level as well as the weekly S1 located at 112.86. A release of better than expected American retail sales and data did not ruin this achievement. In contrast, it simply accelerated a rebound from the bottom trend-line of the currently active . Generally, the exchange rate is expected to resume the movement upwards. However, there is a little chance that it will manage to climb above new combined resistance set up by the monthly PP and the falling 55- and 100-hour SMAs. To put it differently, the pair is expected to make another rebound and continue heading to the south. The main factor that might alter this assumption will be the upcoming US release of manufacturing data.
As it was expected, the currency exchange rate made a rebound from combined resistance formed by the monthly PP and the falling 55- and 100-hour SMAs. However, fears over impact of the new US tax reform that was passed by the House last night led to sharp apperception of all safe have assets, including the Yen.
On the one hand, lower support line of the currently active descending channel sustained the bearish pressure. On the other hand, inability of the rate to break to the top three days in a raw points out on transformation of this pattern into the falling wedge formation.
In any case, a sudden breakout to the north is not expected due to development of another resistance barrier consisting from the falling 55-hour SMA and the weekly S1.
Check out our trading platform: