US$: still lower Highs for time being

The US$ closed with a bullish weekly candle and the EURX closed with a bearish one. However, the pattern of lower Highs and lower Lows is still evident on and the US$ and, until this is broken, not much has changed here.

NB: I am still away and so this is just a brief update.

USDX daily: remains in a descending trading channel and is still printing lower Highs and lower lows. Both patterns need to be broken to confirm a trend change.

USDXdaily

USDX weekly: continues to trade between the 100 and 92.50 range and the bounce off 92.50 continues for now:

USDXweekly

EURX weekly: this is also in a trading range but has printed a bearish weekly candle:

EURXweekly

Ichimoku: the FX indices remain divergent on their Ichimoku charts suggesting continued choppy trade:

  • USDX: is above the 4hr Cloud but below the daily Cloud.
  • EURX: is below the 4hr Cloud and in the daily Cloud.

Both FX indices remain trapped in their weekly cloud though and there may not be trend clarity until both break free from these resistance zones:

USDX weekly Cloud:

USDXweeklyCloud

EURX weekly Cloud:

EURXweeklyCloud

Summary: both indices remain trapped in range-bound patterns and in their respective weekly Ichimoku Cloud. The USDX also remains in a descending trading channel and printing a pattern of lower Highs and lower Lows on the daily-chart time frame. This pattern is bearish and needs to be broken to affect any trend change to higher.

USDX:

I still consider the US$ to be in no-man’s land whilst it trades above 92.50 and below 100. I am waiting for a decisive breakout from this region to signal the next major directional move on the index as this choppy and range-bound price action has gone on for over fifteen months. The levels to keep watching on the USDX are:

  • The weekly chart Flag trend lines.
  • The psychological 100 level above current price. This is the top of the trading range.
  • The 92.50 level below current price. This is the bottom of the trading range.

EURX:

The levels to watch on the EURX continue to be:

  • The weekly chart Flag trend lines.
  • The 103.5 level: The weekly chart reveals that a 50% fib retracement of the recent lengthy bear move is back up near the 103.50 level. Any bullish Flag breakout might see the index target this region and the weekly 200 EMA is near this fib for added confluence.
  • The 105.5 level: this is near the 61.8% fib.
  • The 96 level:This is a major support level for the EURX and has been a previous monthly chart ‘Double Bottom’ region.
  • The 94 level: This is the more recent ‘Double Bottom’ level as seen on the weekly chart.

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