24-hour view: We noted yesterday that “the underlying tone still appears to be soft” and we expected USD to trade with a downward bias. However, we held the view that “7.1800 is still likely out of reach.” Our view turned out to be correct as USD fell to a low of 7.1950. Downward momentum has improved, and today, barring a break above 7.2260 (minor resistance is at 7.2170), USD is likely to break below 7.1800. The next support at 7.1500 is unlikely to come into view today. 

Next 1-3 weeks: Our latest narrative was from two days ago (10 Jul, spot at 7.2230) wherein “the risk of USD pulling back below 7.1800 has increased.” Yesterday (11 Jul, USD fell to a low of 7.1950. Downward momentum has improved further. If USD breaks below 7.1800, the focus will shift to 7.1500. Only a breach of 7.2500 (‘strong resistance’ level previously at 7.2650) would indicate that USD is not ready to head lower.