The BoJ, FOMC & RBNZ are on tap over the next 36hours and as such I’m primarily focused on JPY & USD crosses for now. Here are the setups we’ll be tracking into the releases - I’ll be giving a final update in the webinar tomorrow morning on SB Trade Desk.
USDOLLAR Daily
The U.S. Dollar Index has set an impressive monthly opening range between key support at 11850 & Fibonacci resistance at 12018 – we’ll be looking for a break of this key range to validate a near-term directional bias heading into the FOMC rate decision & subsequent presser with Chair Jannet Yellen.
USDJPY- The potential for a washout here is significant as speculative retail positioning continues to build- approaching extremes not seen since the lows in price were registered back in August. This is USDJPY so expect volatility – We’ll be on the lookout for a move into key support levels just lower for a possible exhaustion / long-entries. I highlighted this setup in today’s Scalp Report.
USDCAD- Loonie remains of interest heading into tomorrow as USDCAD continues to trade within the ascending median-line formation highlighted last week. Near-term support rests with the weekly opening-range low at 1.3135 with our near-term bullish invalidation now raised to 1.3085. A breach above the 200-day moving average at 1.3255 would be needed to fuel the next leg higher.
AUDUSD- We’ve been talking about the long-side of the Aussie for a few days now and while ultimately I do still want to be long, heading into tomorrow the risk remains for a drop into key structural support before resumption of the broader uptrend. Interim support rests at 7500 with our broader bullish invalidation level steady at 61.8% retracement of the May advance at 7380. A breach above 7610 would be needed to validate a near-term breakout.
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---Written by Michael Boutros, Currency Strategist with DailyFX
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