FX Insights

USD declined sharply last Friday to hit a fresh year’s low of 1.3806. The price action suggests that the next leg lower within the bearish phase has started even though any further weakness is expected to encounter solid support at 1.3755. This level is followed closely by 1.3725 which is the rising weekly trend-line support and such strong level is not expected to yield so easily. Overall, the bearish phase that started on 18 May (see Chart of the Day update, spot at 1.3915) is deemed as intact until the trailing stop-loss at 1.3870 is taken out (adjusted lower from 1.3890). Note that we have suggested taking partial profit previously at 1.3820 (triggered on 28 May).