The Currency pair has decreased today, but has failed to reach new lows, has fallen in the second part of the day when the USD was pushed higher by the USDX’s rally, the index has managed to make new highs, signaling that the bulls are still in the game. The US dollar index maintains a bullish perspective, so the greenback could resume the upside movement. The dollar has increased as the United Staes economic figures have come better, the figures have helped the currency to resume the bullish movement.

The United States Retail Sales have increased by 0.8% in October, exceeding the 0.6% estimate, while the Core Retail Sales rose by 0.8%, beating the 0.5% forecast, has come better also versus the 0.7% growth from the previous reading period, the positive data have boosted the USD on the short term. Moreover the Empire State Manufacturing Index has increased from -6.8 points to 1.5 points, has come much better than the -1.5 estimate, while the Import Prices rose by 0.5%, beating the 0.4% prediction. The greenback has retreated in the first part of the day, the minor correction was expected after the impressive rally, and now could resume the bullish momentum.

The price is approaching the 0.7053 static support, which represents a critical level, a drop below his obstacle followed by a retest will open the door for more declines, the sellers will drive the rate towards the next downside target.

Technically, the rate is expected to drop further because has managed to break below the first warning line (Wl1) of the ascending pitchfork, however the perspective is bearish as long as the rate is trading inside the descending pitchfork’s body. The price is expected to approach again the median line (ml) of the descending pitchfork, where he may find temporary support, could be attracted by the confluence area formed at the intersection of the 0.6896 static support with the median line (ml) of the descending pitchfork.  If you’ll look closer you’ll notice that the price action has formed a Head and Shoulders pattern  and a breakdown below the 0.7053 level will validate this pattern.