Upswing is completed and so far testing of strong resistance level 108.08 shows probable weakness of buyers. Thus it’s a key zone: any reversal signal here will have solid power that will drive to start of new downswing in direction of support 106.94 (black trajectory). If bulls manage to settle above 108.08, we’ll get premises for further growth of the quotes in direction 109.38 (blue arrow).
On local structure we see a final stage of market consolidation: the major substantially contracts trading range within the scope of last swing (107.63-108.00) that is, as a rule, inherent to approaching of an impulse.
Following the conditions of the daily chart further bearish scenario appears more likely. And drop of the quotes can be triggered from current levels (red arrow) as well as after completion of pullback in direction 107.80-108.00 (black trajectory).
Main scenario: Decline in direction 107.00.
Alternative scenario: In case of break above 108.00, we expect growth to 109.00 and 109.38.
Shorts from 107.80-108.00 to 107.00.
Longs to 109.00 and 109.38 (in case of move above 108.00).