What a difference a day and an ‘alleged’ US Presidential comment make! The White House has denied any commentary was made about the high US$ but the report seems to have had some impact. The FX indices are now back to being aligned for ‘Risk On’ but a word of caution. We really need to see a clear breakout form the 92.50 – 100 trading region to be confident of the next US$ directional move.
USDX daily: it looks like the daily triangle breakdown will be bearish. I still want to see a clear break below 92.50 before being confident of any pullback effort though:
USDX daily Cloud: this is now aligned with the 4hr chart below the Cloud supporting SHORT US$:
USDX 4hr Cloud: below the Cloud:
EURX daily: in my w/e write-up I noted how my bullish ‘inverse H&S’ might get taken over by a Bear Flag move. For now, though, the trend line break might be to the upside supporting the bullish move out of the two:
EURX daily Cloud: aligned with the 4hr chart above the Cloud and supporting LONG EUR. Note the bullish Tenkan/Kijun cross too:
EURX 4hr: above the Cloud:
Summary: the FX indices are currently aligned for ‘Risk On‘ and traders need to watch for any continuation of that alignment. My experience with periods of alignment is that any trends and TC signals tend to be more reliable and of longer duration. I’ll report on FX pairs shortly.