Although this move has likely excited lower-timeframe buyers, intimidating resistance is in play! Not only is there a daily Quasimodo resistance plotted nearby at 1.2070 that already proved itself last week, there is also a long-term weekly resistance seen at 1.2044 and a 127.2% weekly Fib ext. point at 1.2081.
In view of the unit’s close proximity to higher-timeframe resistance, buying this market is not something we’d label high probability. Equally though, a sell is also a difficult proposition. Aside from the 1.20 band now likely to offer support, another essential point worth noting is the merging 2018 yearly opening level posted on the weekly chart at 1.2004.
Until the higher-timeframe picture offers a cleaner perspective, neither a long nor short seems attractive at this time.
Data points to consider: German Buba President Weidmann speaks at 4.30pm; US CPI m/m figures and US retail sales numbers m/m at 1.30pm GMT .
Areas worthy of attention:
Supports: 1.20 handle; 1.2004.
Resistances: 1.2081; 1.2044; 1.2070.