Despite the recovery in late Thursday trade, the market still managed to take out Wednesday’s low and put in a bearish close. This in conjunction with a failure by the 100-Day SMA could warn that any additional rallies are limited in favor of a major bearish resumption. Market conditions are still highly unpredictable so we would only recommend looking to add to shorts on a break back below 0.8725. Back above 0.8870 negates and gives reason for pause.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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