Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

Free Trading Guides
Subscribe
Please try again
Select

Live Webinar Events

0

Economic Calendar Events

0

Notify me about

Live Webinar Events
Economic Calendar Events

H

High

M

Medium

L

Low
More View More
More USD Patterns

More USD Patterns

Kristian Kerr, Sr. Currency Strategist

Share:

Talking Points

  • USDOLLAR triggers multi-month H&S pattern
  • USD correction just getting started?

Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.

The FXCM US Dollar Index (equally weighted basket of USD versus EUR, JPY, GBP & AUD) has been under steady pressure since the middle of last month. During this time the index triggered a couple of negative technical patterns including a head & shoulders and a double top. Both patterns saw their respective objectives met in recent days. While not a textbook example, one could also make the case that the USDOLLAR triggered a broader multi-month head and shoulders pattern on the move through 11,740 earlier this week. This pattern has much more ominous implications for USD and would suggest a much a much deeper correction against the primary trend is starting to take shape. Near-term the index looks a bit overdone and susceptible to a bounce, but as long as trendline resistance around 11,770 holds the immediate negative structure will remain intact. The 61.8% retracement of the December – April advance around 11,660 looks to be a clear downside pivot with a daily close below this level needed to signal that another round of USD weakness is underway.

To receive other reports from this author via e-mail, sign up to Kristian’s e-mail distribution list via this link.

USDOLLAR Daily Chart: May 15, 2015

Charts Created using Marketscope – Prepared by Kristian Kerr

Key Event Risk in the Week Ahead:

LEVELS TO WATCH

Resistance: 11,750 (Fibonacci), 11,770 (Trendline)

Support: 11,660 (Fibonacci) 11,600 (Gann)

Strategy: Sell USDOLLAR

Entry: Sell USDOLLAR at 11,750

Stop: Daily close above 11,770

Target: Open

--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

To contact Kristian, e-mail instructor@dailyfx.com. Follow me on Twitter at@KKerrFX.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES