Forex FOREX PRO WEEKLY, June 05 - 09, 2023

Sive Morten

Special Consultant to the FPA

This week we've got two major events beyond of NFP report. First is one is the debt ceil decision, whether not the decision itself is important, but mostly its consequences. Second one is political - indirect signs that the US seems to turn to China confrontation, leaving EU deeds on its own. THis topic we keep for Gold report tomorrow. And today consider what steps we should expect from the Fed and US Treasury in nearest few months .

Market overview

The U.S. dollar rose on Friday after May's non-farm payrolls report showed employment numbers surged, while traders weighed the merits of the U.S. Federal Reserve possibly skipping a rate hike in June. The report showed that payrolls in the public and private sector increased by 339,000 in May, far outstripping the 190,000 forecast on average by economists polled by Reuters. May's jump followed a 253,000 rise in April. Despite strong hiring, the unemployment rate rose to 3.7% from a 53-year low of 3.4% in April.

The gain of 339,000 U.S. payroll jobs in May was a blockbuster number, nearly double what was normal before the pandemic and seeming confirmation that key parts of the economy motor along despite aggressive Federal Reserve interest rate increases. But details beneath the headline number may, if sustained, point to some of the first cracks in a labor market that has defied expectations through much of the recovery from the COVID-19 pandemic.

The unemployment rate rose by what is a comparatively large three-tenths of a percentage point, from 3.4% to 3.7%, a level of change not seen, outside the onset of the pandemic, in more than a decade during the sluggish recovery from the 2007-2009 recession. The number of unemployed people jumped by 440,000, the most since November 2010.


"It is only one month of data, and it can be easy to overreact, but certain red flags cannot be ignored," said Nick Bunker, head of economic research at the Indeed Hiring Lab. In addition, the average number of weekly hours worked fell again to 34.3, "and are now below their average level from 2017 to 2019 - a traditional recession indicator and a potential signal that employers are now able to hire workers more readily," he said.

Overall, said Rick Rieder, global bond chief at investment giant BlackRock, hiring momentum in industries that remain short of pre-pandemic employment levels, like leisure and hospitality, or that face notable labor shortages, like health and education, may continue to fuel monthly job gains even as other parts of the job market slow.

"The fact is that the labor market is still very tight, aided by shortfalls in some service sectors, as well as by historic demographic trends" like population aging, Rieder said. "Yet rather than see the Fed crush the labor market now, in order to bring down still excessively high inflation, we think it's likely that in time the economy could recalibrate organically and in a healthier manner."

It's an environment, he said, where the Fed may be right to be cautious.

"The Fed has painted themselves into a corner with these most recent statements about the need to take a pause, and then maybe look to hike in July, and I think they're going to regret it after today's non-farm payroll number," said Paresh Upadhyaya, director of fixed income and currency strategy at Amundi US.

Money markets are pricing in a roughly 25% chance of a June hike, down from near 70% earlier in the week. Market postpones rate hike to July and September. The breaking moment is suggested in January 2024, where first rate cut should follow, by market view. We still think that rate change in June and July seems more logic, with the following natural pause in August. Just because US Treasury now should come on stage with huge borrowings to full liquidity reserves, and this is easier to do with attractive interest rates levels. It is not too long to wait, we'll see.


Federal Reserve officials, whose hike, skip or pause messaging on interest rates has become a high-stakes word puzzle for investors, seem ready to end the U.S. central bank's run of 10 straight rate increases later this month while leaving the door open to a future rise in borrowing costs. For a central bank that says it is "data-dependent," the decision may be more complex than it wants, with the release on Friday of a May employment report that blew through expectations as employers added 339,000 jobs across a broad set of industries. Key inflation data since the last policy meeting also rose.

The U.S. central bank seems "inclined to skip tightening in June but could resume tightening in July. Today's strong employment readings support that action," said Kathy Bostjancic, chief economist for Nationwide.

Fed policymakers in recent weeks have tried hard to keep their options open, with those inclined towards more hikes acknowledging a case to hold steady, and those worried about higher rates acknowledging stubbornly high inflation may require them to slow the economy even further.

Indeed, Philadelphia Fed President Patrick Harker said on Thursday it was "time to at least hit the stop button for one meeting and see how it goes."
A day earlier, Fed Governor Philip Jefferson said skipping a rate hike "would allow the committee to see more data before making decisions about the extent of additional policy firming."

"The challenge is that we've entered the Fed's blackout period ahead of the (Federal Open Market Committee) meeting, which means it's going to be hard to see a push back from officials or any guidance from officials after this employment report," said Marc Chandler, chief market strategist at Bannockburn Global Forex.

Fed officials will enter a pre-meeting "blackout" period after Friday, with no formal chance to reshape market or household expectations as the final data reports for the inter-meeting period are released, most notably the Consumer Price Index data for May due out on June 13 as policymakers gather in Washington.


Opinions have been shifting quick. The release of a Labor Department report on Wednesday that showed an unexpected jump in job openings weighed towards a rate increase given the Fed's focus on the strength of the job market; remarks by Fed Governor and vice chair nominee Philip Jefferson later that day tilted towards a pause when he said "skipping a rate hike at a coming meeting would allow the committee to see more data" before deciding if tighter policy was even needed.


For Larry Meyer, a former Fed governor who analyzes monetary policy for his Washington-based consulting firm, the jump in job openings "pushed us over the edge" to believe the central bank will raise rates again in June.

Investors worried about potential losses among banks from office real estate loans after comments from executives, including Wells Fargo & Co Chief Executive Officer Charlie Scharf and Blackstone President Jonathan Gray at a Sanford C Bernstein investor conference. Scharf said on Wednesday there will be losses in the office loan sector and that the bank was proactively managing its portfolio while he looked to reassure investors that it is not "overly concentrated" in that area.

"Vacancy is 20-plus percent, rents are declining, companies now are obviously thinking about their space needs in light of remote work and the economic climate that's ahead. Lenders are reluctant to have exposure to office buildings. Buyers are reluctant. Valuations are going down," Gray said, according to a transcript from the Bernstein conference.

U.S. domestic banks reported a widespread tightening of lending standards by the end of the first quarter of 2023 - even before the full impact of the regional banking crisis had been felt. Stricter lending criteria are likely to slow the flow of credit to small businesses and households – amplifying the impact of interest rate increases by the Federal Reserve over the last year. The net percentage of domestic banks tightening standards for commercial and industrial (C&I) loans to small businesses with annual sales below $50 million hit +47% at the end of the first quarter.

The net percentage tightening small business C&I standards has risen to levels usually associated with recession, based on past results from the Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS).

JPMorgan Chase & Co's President and Chief Operating Officer Daniel Pinto said the same - loan demand is declining at a time when regional and small banks are also tightening credit. Consumption remains positive, but there are some indications the economy is slowing, Pinto said. He expected the Federal Reserve to raise rates further.

"There is no doubt that regional banks and smaller banks are building up liquidity, building capital, so they are lending a bit less," Pinto told investors on Friday. "I don't think that the big banks have really changed their lending standards... there is not a huge amount of loan demand in the first place."

"Likely the Fed will get to run towards 5.5% and then they will pause" to assess whether efforts to curb inflation have succeeded, Pinto said. If inflation accelerates further, the Fed could raise rates 50 basis points with a series of smaller rate hikes, he said. There will be a "recession at some point," Pinto said. "But I don't see for the moment, a crisis. It's just a slowdown in the economy," he said.

The market mood was also supported by the U.S. Senate passing bipartisan legislation on Thursday that lifted the federal government's $31.4 trillion debt ceiling and averted what would have been a first-ever default. The bill, which had been passed by the House of Representatives on Wednesday, heads to President Joe Biden, who is expected to sign it.

U.S. Treasury yields were higher (!!!) as investors bet on a possible increase in rates although many believe the Fed is likely to stick with a pause in hikes when it meets later this month. Benchmark 10-year notes were up at 3.695%, while yields on the more rate-sensitive 2-year notes rose to 4.509%.

A wave of debt defaults by companies in the United States and Europe is imminent, due in part to the fastest monetary tightening cycle in 15 years, Deutsche Bank said in its annual default study released on Wednesday. Deutsche expects default rates to peak in the fourth quarter of next year. It forecast peak default rates to reach 9% for U.S. high-yield debt, 11.3% for U.S. loans, 4.4% for European high-yield bonds and 7.3% for European loans.

The estimate for a U.S. loan peak default rate of 11.3% would be a near all-time high, compared to a peak of 12% during the 2007-2008 global financial crisis and 7.7% during the U.S. technology bubble in the late 1990s, Deutsche noted.

The euro zone's top banks may take a hit if their financial clients, such as funds, insurers and clearing houses, withdrew their deposits or otherwise ran into trouble, the European Central Bank warned on Tuesday. This could happen if the shadow banks -- or non-bank financial intermediaries (NBFI) in the regulators' jargon -- were themselves hit by outflows or lost confidence in a bank.

"This funding may be highly sensitive to the credit quality of the recipient banks and can amplify the funding pressures faced by banks if the soundness of their fundamentals has been called into question," the ECB said. "If one or a group of such (banks) were to become distressed, there would probably be substantial ramifications in terms of the ability of significant parts of the NBFI sector to manage liquidity and market risks," the ECB said.

Home prices in the euro zone may be headed for a "disorderly" decline as high mortgage rates make purchases unaffordable for households and unattractive for investors, the European Central Bank (ECB) said on Wednesday. It did not list those countries but ECB data indicates that Portugal, Spain and the Baltic countries are among those where the proportion of mortgages with a floating rate is highest.

"Looking ahead, a fall in prices could become disorderly as rising interest rates on new mortgage lending increasingly compromise affordability and increase the interest burden on existing mortgages, especially in countries where variable-rate mortgages predominate," the ECB said.

The ECB also warned that regions where institutional investors have taken large positions in the residential real estate market could take a bigger hit if capital is withdrawn. These included Berlin, parts of western Germany, and some capitals like Paris, Madrid, Lisbon and Dublin.

So, speaking about structural crisis in general - we do not see any big changes, it is going slowly but stubbornly, without any acceleration or slowdown. Everything is the same in the economy. There is a clear decline in the US and in the European Union, most likely things are not going very well in China and Latin America. But as long as the standard of living of the population in the United States is supported by the provision of cheap Chinese goods, things will be better in China than in the United States. This, by the way, is another argument towards the beginning of a policy of restricting China — in a situation of stimulating private demand, logic requires that these very households buy domestic products, not Chinese ones. Here is few pics for illustration -


Consumption is falling, PPI is following, obviously showing the deflationary processes in economy, based on production sector degradation.



Will there be a tightening or easing of monetary policy in the US? As experts mentioned earlier, the last public speeches of Fed Chairman Powell were close to hysteria. Since any decision that the Fed could make takes on a clearly political connotation. And there are no good ways out of the situation anymore.

The format that can be assumed within the framework of the agreements on the national debt limit gives grounds to assume what the policy of the US monetary authorities will be. Since spending cuts of $50 billion with permission to borrow $4 trillion over two years looks pretty wild, we can suggest the following. Only by the end of the year, the Treasury should borrow at least 1.5 trillion. And this is a huge burden on the US monetary system, and in the mode of tightening monetary policy.

Yes, the budget will return this money to the economy, but to the allocated industries, enterprises and municipal farms. In other words, access to money will become more difficult for most of the economy (tightening monetary policy, fighting inflation), but support will be provided for the most needy part, on the contrary. The question is whether this will be enough to reduce inflation, but if it is not enough, then the rate can be raised. But less than it could be. Of course, this scenario will work only if the Treasury takes money from the market.

If it has to deal with the QE of any kind, then inflation will rise for sure. But, as far as we understand, this option is not envisaged yet. Thus, there is reason to believe that answers to both fundamental questions have been found (even if they have not yet been voiced) and in this sense there is no sense in keeping the threat of technical default. That's what we saw.

Now let's take a look at few numbers. Next week, a powerful money pump will begin to work, sucking liquidity from the financial system into US Bonds. The last time the debt limit was raised was on December 16, 2021, and the market, by inertia, lasted only two weeks, after which the strongest collapse since 2008 began.This time, US Treasury borrowing could reach up to $2 trillion from June to December 2023, where $1.2 trillion could be spent on current financing of the budget deficit and up to $800 billion to replenish the zeroed cash position.

It should be understood here that withdrawn liquidity from the market in favor of Treasuries is unallocated cash flows into shares or corporate bonds. The situation with large placements of treasuries clearly aggravated the liquidity balance in the system, redistributing flows from stocks and corporate bonds in treasuries. But - 1.5 years ago the disposition was much better.

Firstly, the peak of net placements occurred from December 17 to March 31 with record net placements of 1 trillion and, most importantly, at low rates, then the Fed's key rate was 0.25%.

Secondly, the main liquidity providers (commercial and investment banks) had much more free cash. Just the peak of the cash position of commercial banks fell on December 15, 2021 (4.23 trillion) and shrank by 1.1 trillion by June 2022, and now it is 3.3 trillion.

It could hurt a lot. The Ministry of Finance can allocate 1.5-2 trillion in the next 6 months, and this is against the backdrop of sales from the Fed (80-95 billion per month), prohibitively high rates and liquidity problems for banks , and there will be more and more problems. Treasury placements should go smoothly, but the stress on the system could be the worst in history.

Even if net placements amount to 1.5 trillion, and the sale of assets from the Fed's balance sheet is half of what was planned, this is over 1.75 trillion, which will be the strongest burden on the dollar system in 6 months. As you can see in the charts, when net borrowing exceeded $1 trillion in 6 months, at that moment the Fed always carried out asset buybacks: 2008-2009, the second half of 2020 and Q1 2022, which leveled the load on the system.


Operations of the US Treasury and the Fed in the aggregate exceeded 1 trillion only twice in history - Q4 2008 and Q3 2020, and now they can hit 1.7-2.5 trillion.
There are few opinions on this subject. Some analysts suggest that super QE already is started, because the provision of urgent liquidity by the Federal System due to the collapse of regional banks de facto looks like the beginning of a new cycle of monetary easing, although externally the Fed continues to raise the interest rate. Monetary easing usually leads to a rise in stocks. And indeed, since the injection of liquidity, stocks have been growing. In addition, it is the cyclical sectors (the Technology sector) that are growing, which also speaks in favor of the hypothesis about the beginning of the cycle.

Thus, the example of Japan seems not as bad - US stock market is pumping up, even crypto shows a kind of bubble of 20-25%. Of course majority of funds will be used to plug the wholes in budget and restore US Treasury liquidity but other markets also should get some crumbs from the table. To be honest, we're a bit skeptic on this scenario by few reasons.

If you take a look at liquidity sources, where Fed could get the money - they are US commercial banks reserves in the Fed, Reverse RePo with the Fed - the same tools that were used in 2021. The difference only in availability of the funds. In 2021 rates were at 0.25% and banks had a large amount of free liquidity, now it is comparable to what Yellen would like to take to her accounts and she will have to fight for it, which implies pressure on government bonds (premiums for loans).
Thus, in addition to the cache in the system, the Fed with a printing press and bank reserves in the Fed, there is also a reverse repo with the Fed, which contains more than $ 2 trillion. The reverse repo mechanism is "money to the Fed in exchange for securities from the Fed", so the flow of money from there is also an issue that the Ministry of Finance will pour into the system in about a quarter. But the participants of the reverse repo will still need to be lured by a premium to profitability.

Meantime, it has never happened to pull out 600-800 billion dollars out of there:


Considering that now the placement of the Ministry of Finance for 2-3 days is held at a rate of more than 6% and the Ministry of Finance will give a premium, it is possible to entice some part of the money from the reverse repo. But this is likely to apply only to short papers. In 2021 on a background of QE, the Fed financed new issues at the expense of free cash in the banking system, and the S&P 500 went down by 10%. The nuance is that right now there is exactly the same amount of cash as the Ministry of Finance needs, so the Ministry of Finance, apparently, will have to fight for this money and give a premium at the rate.

In a case of yield premium, the stakes will go up all over. Here you have an increase in interest rates on loans, and a drop in prices on commercial mortgage bonds, and an increase in unrealized losses for banks from the fact that long-term bonds (probably) even more will become cheaper, and all the other charms. The ways how it could be done seems wide now. But we suggest it's not occasionally they canceled the debt ceiling until 2025. A lot of money may be needed for rescue.

Another source is commercial banks cash reserves in the Fed. They could be replaced by new issues of US Treasuries bonds. At first moment, there will be no effect, because the money from the banks' account at the Fed will be transferred to the Treasury account at the Fed. But then, when the state starts spending them, they will increase the liquidity in the system. By $2 trillion per year, by the way, and this is comparable to covid quantitative easing from Q2 2020 to Q2 2022. Bank reserves are now $ 3.3 trillion, so they will definitely be enough to cover all the state's wants for 2 years, and without issuing directly from the Fed.

Thus, mega-QE can happen without the Fed buying some assets from the market and may even occur at a non-zero rate. But logically we're coming to some questions. there are two questions here. The first is what will be the demand from non-banks for Treasuries. If it is non-zero, then it is likely that the markets will shudder. Because buying bonds by non-banks dries the liquidity out of the economy. Second, why should banks suddenly stop holding money in reserves at the Fed and start buying treasuries if they recently were selling them on the contrary? Can someone force them to do this by regulation?

Fed authorities want to do everything with minimum stress. As direct QE from the Fed as radical steps with interest rate could bring strong negative impact on the market. It means that most probable way is a combination of different tools - give some yield premium on new issues to get funds from Reverse Repo accounts, gently press markets with higher rate to trigger partial capital flow into bond market, slowdown QT a bit etc. Using any radical tool makes us forget about desirable "soft landing". While using mix of different tools could let Fed to get necessary funds. Still, combined effect anyway will be equal to Fed tightening. They will try to print as few as they can grabbing liquidity that already exists in the system. Thus, this another reason why we think that chances on rate hike in June is well above 25%. People just do not consider this reasons. So, demand for US Dollar, should remain as well as the pressure on Dollar rivals, at least until the end of active borrowing period Historically it lasts 6-8 weeks, but this time it could be longer because of costly and less available liquidity in the US economy. When you've read everything - take a look at 10 year US Treasury chart - it seems that they suspect something:



So, EUR has confirmed bearish reversal feature of May candle, June one is small by far, making no impact on overall situation. Despite the MACD trend remains bullish here, and it could remain bullish, if even EUR drops back to the parity, but whatever depth of retracement will be - this is big move as we're talking about monthly chart.

Now situation looks supportive to B&B "Sell" idea with potential target around 1.0130-1.02 area. It is interesting how EUR will go with it. Until reversal bar is valid - bearish potential holds here. Few other targets, that we've specified last week are valid as well.


For example, on the weekly chart we're busy with divergence and nearest target around 1.05 lows. First is, because this is divergence target, second - this is weekly oversold, and, finally, this is YPP.

Once again - interesting indecision candle this time. Last week we've got it on daily chart and we've explained why it is important. Now we have it here, on weekly time frame. Next EUR steps depends on direction of its breakout. Logic tells that it should be downside, but let's not to run ahead of train.



Here a bit tricky moment has happened on Friday - downside action started but prior 1.0810 area that we've suggested. On Gold market B&B has worked normally, because it already was around 3/8 Fib level.

This brings some indecision situation. Formally it keeps door open for DRPO "Buy", because 3/8 Fib level has not been reached, but bullish reversal pattern looks a bit irrational in current fundamental environment. Formally, daily trend has turned up. Now we have no choice but wait for next pattern here.



Downside action has started right from XOP that we've estimated. Here we're coming to reverse H&S pattern, although it looks not as accurate. And we see another negative moment with it - too fast action to the right arm. It looks bearish. Besides, Gold has broken 5/8 support and H&S shape. Thus, for bearish position taking, we could keep an eye on 5/8 level (1.0690) breakout. Once chances on bullish pattern will be erased, it is possible to consider short entry. Personally I would wait with long position and consider it by far. But it is not forbidden of course and you could consider 1.0690 support and reverse H&S looking shape.
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Morning everybody,

So, on daily chart we do not have big changes, and all activity mostly stands on 1H chart. On daily, we just remind you that direction mostly will depend on breakout. As we've said in weekly report - recent week was indecision one. Based on performance here - DRPO "Buy" seems still possible, but irrational abit, or, at least, currently reasons for sharp EUR reversal are not clear. If even ECB will raise rate, as C. Lagarde said yesterday - it is not the reason for sharp reversal yet. RBA by the way, today also unexpectedly raise the rate, so, Fed could do the same and a day earlier than the ECB... we will see.


It means that nothing is clear yet, and we easily could get something of this kind:

So, what we could do in current situation? If you've got long position around 1.0690 support area that we've discussed, your stops probably already at breakeven. For new entry bulls now have to wait for DRPO on daily chart, at least.

For the bears, it seems it makes sense to wait for 2-leg upside bounce and appearing of "222" Sell here. If we're correct on butterfly, then this scenario lets us to take position very close to invalidation point, which is above the butterfly's top. Alternatively, if downside action starts immediately, position could be taking when EUR breaks 5/8 support and recent lows, forming downside reversal swing. It should be (at least in most cases it does) that downside continuation is under way already:
Morning everybody,

So, EUR turns down again, even was not able to complete our intraday "222" Sell pattern. Although theoretical chances on DRPO "Buy" still exist here, on daily, I have no idea what particular driver could trigger it, at least for now. Maybe, if ECB hikes, Fed pauses and Lagarde give super hawkish speech - this could change short-term situation, but this is only suggestion... For now I do not see good background for long entry.

The only tricky moment, concerning daily chart we have on Dollar Index. It could bring some problems for DXY upside continuation:


On 4H chart our butterfly is still valid:

On 1H chart market has erased Lagarde's rally and dropped back under 0.618 support level. Market is forming a kind of wedge consolidation. Here, on 1H chart we do not have any additional patterns. Thus, if you intend to trade it short, you have to deal with 4H chart. Thus, to contract potential S/L placement, maybe it makes sense to wait for some upside swings inside the wedge to get better entry price area.
Morning everybody,

Due to really epic and tectonic shifts in the US financial system, we see crazy action on intraday charts. Not only EUR but at many other assets. Meantime, recall our weekly discussion, where we said that direction depends on breakout, as EUR stands indecision. Indeed, despite strong fluctuations on 1H chart, on daily one action stands inside the same range.

Technical chances still exist for DRPO "Buy", but I wouldn't count on it by few reasons. First is - formally 2nd close above 3x3 DMA gives us DRPO, but it will not be the DRPO, because of price mechanics mismatch. We want to see bears capitulation on pushing price lower - but here we do not see it, because it was no attempt to push price lower. Price just is consolidating, taking the pennant shape. Which, in turn, potentially is bearish.

Besides, cross market analysis as on GBP (H&S) as on GBP/JPY (monthly XOP) as of US yields that are raising hint that downside chances looks better now:

Despite that triangle keeps door open for both direction, I still gravitate to this idea, so I keep only downside butterfly here, although you could imagine easily the opposite one as well:

Thus, market looks a bit chaotic on 1H chart, with all these crazy spikes and drops. Yesterday action is just recent example. If you check the news line in our Telegram - you will see why. Anyway - currently the best solution is to wait for direction. But "to wait", as we all know is most difficult strategy ;) Thus, if you still want to take position - try to do it as closer to invalidation point as possible, depending on your direction. Because your stop should be outside of 1.0670-1.0780 range. Thus if you're with downside butterfly - your stop is above 1.0780 and conversely - if you're with upside scenario and potential butterfly, your stop at least has to be under 1.0670 area.

IF you still decide to wait, additionally it is possible to use Stop "Sell" orders entry tactic, that we usually apply when breakout direction is not known but we expect strong action as soon as it happens.
Morning guys,

So, Bulls scored yesterday - 1:0. Formal reason is poor initial claims data. It seems a bit early but investors start making bets on Fed meeting, expecting flat decision and pause in rate change. Common expectations of ECB hike turns balance in favor of EUR. Additionally speculators are shaking boat, because I haven't seen so strong reaction on Initial claims for a long time. Anyway, daily trend right now is bullish, and we have a kind of DRPO "Buy" with minimum target around 1.0850-1.0860 area:

On 4H chart our triangle has been broken up and upside butterfly is forming right now. Additionally we have to pay attention to 1.0810 area - major upside target of OP, butterfly extension which are both agree with daily Fib level. Then, we have 1.618 butterfly extension which is similar to DRPO target and finally, XOP around 1.09 - hardly we need more this week.

I still worry a bit, that it might be tricky upside action. If those who have started it, step away - it could finish as fast as it has started.... anyway... now on 1H chart we need to focus on two levels - 1.0750 and 1.0730 K-area. If EUR hits 1.0750 before 1.0810 target will be reached - most probable upside action continues from 1.0750, because it should not be deep retracement until major target is reached. If, in turn, market hits OP first, then, ignore 1.0750 and be prepared for deeper pullback, most probable to K-area. But don't forget adjust levels higher:

Finally, although it will be not quite safe, but bears still could consider scalp short position from 1.0810 resistance area, because it wil be "222" Sell. 3/8 pullback at least, could happen. But, this is just an option, it will be tricky on upside trend direction. Think twice.