At the moment the spot rate is testing the upper limit of its medium term bearish channel at 1.3270 and is likely to decline. However, a breakdown of these levels will reveal significant potential and initiate a violent bullish trend.
Technical indicators provide buy-signals but as the resistance is unbroken, the assumption of a decline is relevant. Bollinger bands have greatly tightened in recent days showing a decline in volatility and the imminence of a violent movement
According to previous events the market will provide a bullish opportunity as soon as the spot rate has broken through its resistance of 1.3270 with the 1st objective seen at 1.3330 and 1.3350. A breakdown of 1.3250 level will cancel this scenario.
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