USD/BRL must overcome 5.10 to affirm an extended rebound – SocGen

USD/BRL is back above 5.00. Economists at Société Générale analyze the pair’s technical outlook.

Downtrend could resume on a break under 4.93

“USD/BRL broke below the consolidation since last August however the downward momentum has not regained. The pair has formed an interim support near April low of 4.89 resulting in an initial bounce towards the 50-DMA. Recent pivot high at 5.10 is a short-term resistance. This must be overcome to affirm an extended rebound.”

“In case the pair fails to defend low formed this week at 4.93, the downtrend could resume.”