Our forecast of the pair’s growth made last week has panned out completely. And as we see the upward potential isn’t exhausted yet - break of upper Bollinger band has taken place once again being an attribute of continuation of the quotes’ growth.
We should acknowledge highly overbought conditions as well, therefore a scenario of prior correction also exists.
We note strong dynamic support at the area of middle Bollinger band (6.837). At the moment this level is of most interest as buy zone.
Locally a contraction of trading range is in progress within Bollinger bands (6.867-6.883), where prior trading is likely before an upward momentum (watch the black arrow).
But scenario of testing of the support 6.837 looks more preferable - this would allow to ease overbought conditions somewhat (watch the red arrow).
Main scenario: Decline to 6.837 and then growth in direction 6.969.
Alternative scenario: Flat in the 6.867-6.883 range with following upward momentum in direction 6.969.
Longs from the 6.837 level towards 6.969.