We get another test and bounce from the age old support and resistance level
The 112.50 level is becoming legendary as a point to watch for stalls and reverses. Of course, conditions have to be right. I wouldn’t trust it if we were 10 pips away before an NFP or FOMC but otherwise it’s been a significant level for a very long time.
We traded down to there just now and have bounced back to 112.67, in no small part to a rebound in US 10 year yields knocking into 2.50% again.
I was getting myself ready to buy down near 112.00 if the 50 level went but that looks off the cards right now. We’d probably be pushing much higher in this pair but for the fact that there’s still persistent yen buying in the crosses. If that stops or turns around, we could well see a very quick move through 113.00.
Although I’m bearish over the longer-term, intraday, the dollar is looking reasonably bullish.
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