US Dollar Talking Points:
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saw last week’s friday A notable counter-trend move in the US dollar, Price had pushed below a key point of previous resistance near 109.14-109.27, and this was helped by a bullish push The day after EUR/USD ECB rises by 75 bp,
This pullback in USD continued through yesterday’s trade and into this morning, with price finding support around the 107.79 area on the chart. it was a former price action swing It was resistance-to-support and it helped to case the bulls again this morning, with DXY jumping back above the 110 handle.
This puts the bulls back in the driver’s seat and that area of former resistance around 109.14-109.27 now becomes a high-low support potential. If it doesn’t, there’s another place a little deeper, nearby resistance to support at 108.38.
US Dollar Two Hour Price Chart
chart prepared by James Stanley, USD, DXY on tradingview
US dollar long term
The big picture, the question is whether the bulls are ready to test the handle of the 110. This was a big spot last week and we only saw one daily close above – which was quickly followed by a in the grip of recession on Wednesday.
The current 20-year high is at 110.79, so if buyers can really stretch it becomes a modus operandi of interest, but the big question is whether the next test at 110. From the chart above you can see the resistance inflection at 110, which was aligned with a trendline at the time. Will sellers defend this level again and be concerned – will EUR/USD bulls defend support at .9950 or maybe even .9900?
In my opinion, the more systematic this step is – the better. If we see some elements of the high-low support building before that 110 retest or maybe 110.79 retest, more fascinating continuation topics become.
Currently DXY’s daily bar is a . working on swallow fast Which indicates the possibility of continuation of the topside trend.
US dollar daily chart
chart prepared by James Stanley, USD, DXY on Tradingview
Another round on EUR/USD parity
As the USD is back in strength, so has the EUR/USD weakness.
The pair was in an unsafe position last week when I saw it after the ECB meeting, ECB rate not increased by 75 basis points actually get the price by fridayAfter EUR/USD finds support in the past falling nail resistance, And the bullish short-term trend continued in the early part of the week.
After this CPI print it has now flipped on its head and is back on the EUR/USD parity handle, grasping for support.
EUR/USD Daily Price Chart
chart prepared by James Stanley, EURUSD on tradingview
EUR/USD is now back in the zone that sellers had a hard time leaving behind. it helped to make falling nail Which caused the bullish breakout. Now the big question is whether the sellers will be able to break below the low.
At this point the bears have made a clear re-entry into the position and this could keep the door open for short term momentum strategies. Former points of support, such as 1.0034 or 1.0063 may now be remodeled as resistance. The next item of support on my chart is near the .9950 area followed by the .9900 level. The break of .9862 is a new 20-year low and keeps the door open for bearish breakout strategies.
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EUR/USD Four Hour Price Chart
chart prepared by James Stanley, EURUSD on Tradingview
It was another recovery move that was brought into question after this morning’s CPI print. GBP/USD was created A strong run at the 1.1750 resistance I was talking about on Friday, And now we have 1.1500 . but coming again psychological level Which helped bounce off last weekend.
Today’s daily bar is currently acting bearish, so the stage is set for another showdown at the 1.1500 level. If sellers can enter, the eye moves to the 1.1404-1.1414 level which helped mark a new 37-year low last week.
as i saw this week British Pound Technical Forecast, GBP/JPY may be of more interest to those who have a bullish trend in GBP. The pair is now very close to a key point of resistance at 168.06.
GBP/USD Daily Chart
chart prepared by James Stanley, GBPUSD on tradingview
I will keep it for a long time as I am currently interested in USD/CAD. Price today is putting in a major pivot with the US trend but the more noteworthy thing in my mind is that it is happening around 1.3000 on the chart. psychological level, and for the long term, there is a remainder bear flag In play.
In particular, the pair failed to test higher over the past two weeks, a massive sell-off developed after the second unsuccessful attempt last week. This led to a new multi-week low, but the bulls have made a lot of ground so far this morning.
This setup for a bullish breakout potential should continue all the way to a retest of that annual high around 1.3224. But – if the bulls fail to retest that high watermark, we have another lower-high, and this is something that could lead to bearish themes with continued growth.
Like the GBP/USD above, the daily chart is acting on an engulfing pattern, so I would be very careful plotting the reversals right after that print. But, it will be worth watching in the next few days. If there is a breakout, there is a possibility of a bullish move up to 50% of the 2020-2021 move. If there is a lower-high, the look goes back to 1.3000 and perhaps a retest of 1.2950.
USD/CAD Weekly Chart
chart prepared by James Stanley, USDCAD on tradingview
With rates rising on the back of this CPI print, we have seen both the strengthening of the US dollar and the weakness of the Japanese yen.
USD/JPY came very close to reaching the 145.00 psychological level last week, which was just one pip shy of testing the bigger figure. And what started as a pullback began to gain little interest for the reversal subjects, with support eventually hovering around 141.50.
This morning’s move has pushed the price back into an area where the price action was actually put into some grinding after failing at 145.00. It runs from about 144.21-144.39. And looking at the recent dynamics, a location of the main support is plotted around support to resistance at 143.29
From the point of view of formation – it can also be argued that a double bottom At work, though there was a difference of about 11-12 pips from those swing lows, so it would really depend on how technical you want to get into it (this is ‘technical’ analysis, after all). But – from that point of view, there would be around 200 pips from the bottom to the neckline, placing a 200 pip resistance target above the neckline – which projects to around 145.50.
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USD/JPY Two Hour Price Chart
chart prepared by James Stanley, USDJPY on tradingview
— Written by James Stanley, Senior Strategist, DailyFX.com and Head of DailyFX Education
Contact and follow James on Twitter: @JStanleyFX