Technical Outlook explained by professional Forex trading experts the “Technical Outlook” FX trading team.
The US Dollar Index (DXY) is at serious risk of resuming the downtrend starting dating back to the start of the year. In the past couple of sessions EUR/USD has run over the ‘neckline’ of the widely-watched ‘head-and-shoulders’ pattern as well as the trend-line off the ‘head’ of the formation. This helps clear a path towards the highs in September, but must first overcome resistance around the 2010 low of 11876. The ideal scenario is for a small pullback to develop before running through resistance. In ‘wait-and-see’ mode at the moment.
USD/JPY recently broke down from a wedge which developed at confluence consisting of three points; underside of September 2016 trend-line, August 2015 trend-line, and a pair of peaks from May to July. Looking for a decline to the next area of big support around the 11175-area where horizontal price support and the 200-day MA meet.
GBP/USD is in a choppy range still above trend-line support, avoiding for now until better clarity. USD/CAD clinging to a trend-line off the September low, but looks vulnerable to breaking. AUD/USD is at a trend-line of interest off the December low, while NZDUSD is attempting to carve out a higher-low after hitting support late last month.
EUR/AUD and EUR/NZD have been on a tear, but both face critical tests of resistance at ~15600 and ~17200, respectively. How they respond here will help provide information as to the next move. The yen-crosses all look vulnerable for the most part with USD/JPY rolling over and stocks clearly weakening. USD/MXN is developing an ascending wedge right at critical resistance from earlier in the year and a trend-line extending higher from November 2015.
Technical Outlook Conclusion
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