USD/BRL to extend its decline on a break below support at 4.84 – SocGen

The BRL has done well this year to rally 7.7% on spot basis vs. USD. Economists at Société Générale analyze USD/BRL technical outlook.

Right shoulder near 4.97 must be overcome to negate the Head and Shoulders formation

The pair is now close to crucial graphical level of 4.84 which is also the neckline of Head and Shoulders. Break below this support would confirm the pattern and denote an extended decline towards 4.78 and July low of 4.73/4.69. 

The right shoulder near 4.97 must be overcome to negate the formation.