USDX
Monthly: Ranging. A bull support trend line is in place. The current candle, with a few days to go, is an indecision spinning top candle.
Weekly: Trend up overall. Price has broken out and up from trading within a symmetrical triangle. Last week’s candle was a bullish engulfing candle. There is still a bit of a ‘bear flag’ look about this chart to me though.
Daily: Down overall but price has broken out and up above the bear trend line. Has price made a ‘Double top’ though now? Still looks a bit ‘bear flag’ like here to me.
Daily Ichimoku Cloud chart: Price has retraced upwards and is now trading almost within the Cloud.
4hr: Ranging between 79 and 80. Price has rallied for most of the week. Price did re-trace to the 61.8 % fib level from the last swing high and then some! Price has had trouble making a clear break away, either up or down, from the significant psychological 80 level. The monthly pivot is here too.
4hr Ichimoku Cloud chart: Price has retraced and is now trading above the Cloud on the 4hr chart. This is divergent from the daily Cloud chart.
EURX
Monthly: Trend down but has turned back up. August and September candles were bullish. October is also still a bullish candle and had earlier broken out and up from the smaller of two symmetrical triangles. Price could also be forming a ‘Bear Flag’ pattern though??
Weekly: Trend down but turning back up. Price broke out above the bear trend line of the smaller of two symmetrical triangle patterns but retraced to finish the week right back on top of this broken trend line! Price is still held up by a bull support trend line. Last week’s candle was an ‘inside candle’. These can be viewed as simply indecision candles or as bearish patterns if they appear in an uptrend, such as is the case here.
Daily: Trend up overall. Price has broken out of the smaller triangle but might be forming a bearish ‘double top’. The daily support trend line will be key here to any longer term down trend.
Daily Ichimoku Cloud chart: Price has been out of the Ichimoku daily cloud now some weeks but is back to trading within the Tenkan and Kijun –sen lines. The Cloud is still edging up closer to current price though.
4 hr: Price bouncing sideways in a wedge pattern. Price ended the week at the previously broken bear trend line and near the daily 200 EMA.
4hr Ichimoku Cloud chart: Price has fallen back down and is currently just below the Cloud on the 4hr chart. This is divergent from the daily chart though.
Thoughts: The USDX has rallied this week, breaking out and up from a triangle pattern and closing above some important resistance levels. It is looking quite bullish now. It has failed to make a clear and decisive break away from the key 80 resistance level though. We have had some positive economic data but some poor earnings data, as well as continued Euro zone concern and US President uncertainty, seems to be hampering a new and clear momentum for either ‘risk on’ or ‘risk off’. I won't be surprised to see another choppy week though given we have divergence on both the USDX and EURX Cloud charts.
I will look for 'risk on' trades if:
- the USDX returns to bearish and breaks, closes and holds back down below the 80 level.
- the EURX returns to being bullish.
I will look for 'risk off' trades if:
- the USDX remains bullish and holds above the 80 level AND if
- the EURX remains being bearish and breaks, closes and holds below the bull trend line on the daily chart.
As always, Fundamentals, by way of Euro zone dramas and news announcements, continue to be triggers for price movement on the indices. These events can always have the potential to undermine all Technical analysis.
No comments:
Post a Comment