Short-term momentum is still signifying weakness but the consolidation from 1/10-1/25 continues to contain this correction lower. We favor this as a correction lower and not a new downtrend because 1. the uptrend from November and the uptrend from July are still in force, 2. the last bullish consolidation is containing this pullback and 3. daily momentum has reached the low end of its bullish support zone. A break below pivot & Nov channel support at 1.3260 would be enough to neutralize our bullish bias. (c1) S/t, there is an old pivot high at 1.3308 that has yet to give way and more substantial support at the old lows and Fibo retracement zone near 1.3260. Above the o/n high at 1.3393 is the first sign that the correction is complete but a break through the down channel at 1.3460 is needed to confirm further strength and a new leg higher to test 1.37. (c2) Levels: Support – 1.3308, 1.3260, 1.3190 Resistance – 1.3393, 1.3460, 1.3520
Nomura