USD/RUB erases rally; could weaken further in short-term.
USD/RUB recorded a stunning rally last week towards a 16-month high of 64.83, marking an overall gain of 6.4% during the period. This week, though, the pair is on the backfoot and the technical indicators suggest that the market could ease a little bit in the short-term.
The RSI is currently losing strength and looks to be heading towards its neutral threshold of 50 after an exit from overbought levels, while the MACD is slowing down in positive territory, both hinting that the next move in prices could be on the downside rather than on the upside. However, stochastics indicate that a rebound is not far off since the oscillators are near to oversold levels. Still, this is more likely to happen if the green % K line finally forms a bullish cross with the red %D line.
Should the market extend losses, support could be met between July’s 2017 high of 60.74 and the 60.07 barrier, which is the 50% Fibonacci of the up-leg from 55.34 to 64.83. A significant leg below this area could send prices towards the 20-day simple moving average (SMA) which currently fluctuates around 59.27 before the market retests the 61.8% Fibonacci of 58.95. Then, if the market fails to hold above this level, the next stop could be at the 200-day SMA at 57.98.
On the flip side, if the pair bounces up, immediate resistance could be met at the 38.2% Fibonacci of 61.17. Steeper increases could also target the 23.6% Fibonacci of 62.57.
In the bigger picture, the pair is bullish as long as it holds above the 200-day MA. In case it violates this line, bears could take the upper hand.
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