Overview:- By analyzing at the daily chart we can see that earlier pair was making successively higher highs and higher lows and heading north side but from last couple of days bears took the charge. Pair has made high of 1.1238 level and then turned back to south side at 1.1100 level which is a strong key support level.
Technical prospective:- From technical prospective we can see that pair has tested the 50 EMA line which is a strong key support level which is providing us bullish signal and indicates that from here bulls will move up. The 1.1100 level is a psychological level for bulls. If today bulls trades and sustains above this level then we will get assure that it’s time to buy. Well primary and secondary trend is up so in an uptrend market always buy on dips will be profitable strategy. A short term uptrend line is also lying which is providing us bullish signal. A long term rounding bottom pattern is forming on the chart which is providing us bullish signal .
If bulls gives us daily closing above 1.1150 level, which is a psychological level then we will get assurance of bullishness. Overall pair is trading and sustaining between the moving average lines which is providing upside signal. A bullish crossover on MACD indicator is providing us bullish signal and RSI started to incline above 50 with a small divergence. Odds are in favor of bulls and our bias remains bullish on the pair as long as 1.1150 level remains intact.
What next:- Primary to secondary trend is up so in an uptrend market buy on dips will be profitable strategy. The pair could face the next support at 1.1050 ahead of 1.1000. On the upside, resistances align at 1.1200 and 1.1250.
Trade idea:- Based on chart and studies above we can suggest that buy the pair at CMP 1.1100 for the target of 1.1200 and 1.1300 with the tight stop loss of 1.1000.
