Analys från DailyFX

US DOLLAR Technical Analysis: There Is A Season…

Published

8 år ago

6 april, 2016

DailyFX

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Talking Points:

US Dollar Technical Strategy: Short On Hold of 200-DMA As Resistance
US Dollar Sees Largest 2-Day Drop since Topping in March 2015
US Dollar Below 1-year 3-Standard Deviation Channel

Dollar Bulls, or what’s left of them, have found themselves at a definitive level. The recent bounce from 11,854 has aligned with the 2009 high and is a level that we’ve encouraged focusing on since the drop began in February. Now that we are here, it is perfectly plausible to think a breakdown in the long-term dollar trend is around the corner.

Of course, few would have predicted this in January as we had the highest levels in 14 years on the dollar index, but we now have a narrative from the Federal Reserve that appears focused on limiting dollar strength. Much of the gas in the tank for the dollar over the last 21 months has been attention on multiple rate hikes from the Federal Reserve getting priced into the previously beaten-down dollar. If multiple rate hikes do not come to fruition as is expected, we could have a lot of air coming out of this balloon.

In addition, April is a month that typically favors US Dollar weakness, and commodity FX strength. That alone is not enough to trade upon, but a breakdown in the US Dollar or breakout in the counter currencies could show us the trend is resuming.

Key Levels From Here

For now, we’ve seen a bounce off the previously mentioned key level around 11,850 (2009 high: 11,854) recent low. Below is 11737/634, which encompass the February, April, May, and June lows. If these levels fail to hold, we could be working on a longer-term setback that retraces much of the gains from the July 1, 2014, low. If that is the case, it is fair to think we could see a downtrend in the US Dollar through much of the year.

Below the levels of support mentioned above is the 38.2% Retracement of the July 2014-February 2016 Range at 11,564. For now, until resistance break, this level appears a worthy target on a broader US Dollar weakness move. Regarding appropriate Technical Resistance, I’ll use the daily Ichimoku cloud as well as sentiment via the speculative sentiment index. If the retail crowd continues to try and “buy low’ without the Fed changing their outlook, it could be another sign that SSI will be a helpful guide of what to buy and what not to buy.

In short, the environment favors selling moves into resistance as it has since February. Until resistance breaks, it is difficult to argue that the Fed will continue to talk in such a way that buying the dollar is either unattractive or forced. Traders can continue to keep an eye on USDJPY EURUSD for validation or reversal of the US Dollar downtrend.

Interested In our Analyst’s Longer-Term Dollar Outlook? Please sign up for our free dollar guide here.

An easy way to wait to buy the dollar is to lean against the faithful and tried 200-DMA. In 2H 2015, the 200-DMA was an effective tool to show you when to buy the dip. Since that level broke this year, the US Dollar has failed to attract buyers as it did in the run-up, and it could denote a larger behavior change is taking place. A behavior change that likely benefits dollar counterparts as well as higher-yielding commodity and emerging market currencies.

T.Y.

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form