The uptrend from early April was broken with yesterday’s bearish reversal. The reversal is notable as it began from a long-term pivot near 1.3172 that dates back to last fall. Significant also was the bull trap that developed after the 1.3138 breakout. Now the rally from 1.27 is best viewed as a complete A-B-C correction. S/t, the sell-off is from 1.3200 is undergoing a small bear flag correction higher. Support today is 1.3031 and then 1.3002; a break of the latter is confirmation that the new trend has shifted to down. Any further rally within the bear flag is expected to find resistance at 1.3077/1.3101. Levels: Support – 1.3100, 1.3082, 1.3022 Resistance – 1.3172, 1.3200, 1.3306
Nomura