The low price for the day did crack below the 61.8% retracement at 1.37208 on its way to a low for the day at 1.3716, but could not sustain momentum on that break. The current price is trading at 1.3726 which is still above the 61.8% retracement level (and low of the swing area).
A move - and staying below - the 1.37208 level would have traders targeting the 1.3700 natural support level, followed by the rising 100 hour moving average at 1.3676. The high price going back to last Monday comes in just below that level at 1.36738. After that comes the 50% midpoint at 1.36617. Those levels are the progression to the downside on further corrective bearish price action.
Should the support hold here, a rotation back above the 1.37502 swing high from September 23, followed by a move above the high for the day at 1.3764 should increase the bullish bias.
Overall, although the price is lower on the day, the sellers still have to prove that they could take back more control after the rise higher since the September 29 low. Holding resistance against the 1.37636 swing area gives sellers some hope, but getting below the 61.8% retracement 1.37208 is still needed to increase the corrective/bearish bias at least in the short term.
Bank of England Governor Bailey on Sunday that the BOE is gearing up to raise interest rates for the first time since the onset of the coronavirus crisis on the back of inflation risks. He continues to think that inflation is temporary, but the higher oil prices will likely keep inflation rates higher for longer.
J.P. Morgan now expects a 50 basis point rise in November followed by an additional 25 basis point rise in February of next year.
The Reserve Bank of New Zealand raise rates by 25 basis points at their last meeting. Overnight, inflation for the quarter came in at 2.2% which was much higher than the 1.5% expectations and should keep the rate rise trend going.