The spot rate broke the intermediate resistance of its medium-term bearish channel at 103.10 leading to acceleration. A pull back on these levels is expected before the upper limit of its channel at 105.10 is reached.
Technical indicators provide sell signals supporting the assumption of a pull back in the short term. Bollinger bands are much discarded as a result of a strong increase these days. Stabilization is expected in the short term.
The spot rate is currently testing the intermediate support of its channel, we suggest 2 scenarios. The first one is the hypothesis of a pull back where we recommend a buy on the level of 103.10 with the 1st objective at 103.70 and then at 103.90. A breakthrough of 102.90 will invalidate this scenario. The second scenario is a break of its support where we advise a “sell stop” which means to sell the spot rate as soon as it is broken through its support of 103.10 with the 1st objective at 102.50 and then at 102.30. A breakthrough of 103.30 will invalidate this scenario.