A bad day for the US$ shifts bias back to ‘risk-on’

The US$ index has fallen following the dovish FOMC commentary.  The index still remains range bound for now though but I will be watching to see if this FOMC meeting becomes the event that might finally trigger a breakout from this 12 month+ trading range.

USDX daily: a bearish daily triangle breakdown looks likely here:

USDXdaily

USDX weekly: until there is a breakout from the 100-92.50 trading range though it’s just ‘same old……same old’. Price action is nearing the mid-way mark for this lengthy range so watch for any break and hold below the 95.50 level. Bearish targets below this include the bottom of the trading range at 92.50 and, then, way down near the 61.8% fib and previous triangle breakout region:

USDXweekly

EURX daily: the Euro index has capitulated higher and is up testing a daily triangle trend line so watch for any breakout here:

EURXdaily

EURX weekly: as for the US$ index, this index has been range bound for over 12 months. Any bullish continuation might target the upper levels highlighted on the chart:

EURXweekly

FX Index Alignment: this latest US$ weakness has tipped the FX Indices back into an alignment for ‘risk-on‘ so watch for any hold with this momentum:

  • LONG EUR$
  • SHORT US$

USDX 4hr Cloud: below the Cloud:

USDX4hrCloud

USDX daily: below the Cloud:

USDXdailyCloud

EURX 4hr: above the Cloud:

EURX4hrCloud

EURX daily: looks set to close above the Cloud:

EURXdailyCloud

Summary: The US$ has weakened following FOMC but still remains range-bound on the longer time frame. A break and hold below the bottom of this trading range at 92.50 would be a further bearish signal though. Watch for any continued bearish US$ sentiment to support a ‘risk-on’ bias.

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