Near-Term Support and Breakdown Risk
Tuesday’s higher daily low of $102.72 marks immediate support, confirmed by the 10-day moving average, currently at $102.85. Therefore, a drop below that level increases the chance of a continuation of the bearish retracement that began last week, with a potential decline below $101.40. Key potential support would then be near the 20-day moving average, now at $98.21.
20-Day Test Could Reveal Demand
The market recognized the price zone near the 20-day moving average on the way up last Tuesday, as it consolidated near it before moving higher. This would be the first pullback to test support near the 20-day average since it was reclaimed and therefore signs of support would be anticipated. It also suggests that the reaction of price near the 20-day line should provide clues about supply and demand dynamics.
Deeper Support Defines Broader Outcome
Further down, there is the potentially more significant support zone near the 61.8% Fibonacci retracement at $93.97, along with the rising 50-day moving average, now at $93.55. The 50-day average is a key trend indicator, since it was successfully tested as support during the last decline. Taken together, the interaction with these key support zones will help determine whether the current consolidation resolves into renewed upside or a deeper retracement phase.
