USD/BRL may fall 372 - 557 pips

Our pivot point stands at 5.4799.

Our preference

The downside prevails as long as 5.4799 is resistance.

Alternative scenario

The upside breakout of 5.4799, would call for 5.5111 and 5.5297.

Comment

The RSI is trading below 30. This could mean that either the pair is in a lasting downtrend or just oversold and that therefore a rebound could shape (look for bullish divergence in this case). The MACD is below its signal line and negative. The configuration is negative. Moreover, the price stands below its 20 and 50 period moving average (respectively at 5.4709 and 5.4708). Finally, the USD/BRL is trading below its lower Bollinger band (standing at 5.4634).

Supports and resistances

5.5297 **

5.5111 *

5.4799 **

5.4677

5.4554 last

5.4182

5.3997 **

5.3811 *

5.3625 **

Number of asterisks represents the strength of support and resistance levels.