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EUR/USD, AUD/USD & USD/CAD Technical Setups- Election Levels

EUR/USD, AUD/USD & USD/CAD Technical Setups- Election Levels

Michael Boutros, Strategist

Near-term Technical Outlook: Trade Setups on EUR/USD, AUD/USD & USD/CAD

  • Technical charts on trade setup we’ve been tracking in EUR/USD, AUD/USD &USD/CAD
  • Euro testing key support near September lows
  • Aussie at critical yearly open support zone
  • USD/CAD breakout stalls – support into 1.32
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An update on technical setups we've been tracking inEuro, Aussie & Loonie. These are the targets and invalidation levels that matter heading into the US Presidential Elections and key central bank rate decisions this week.Review my latest Strategy Webinar for an in-depth breakdown of thesetrade setups and more.

Euro Price Chart – EUR/USD 120min

Euro Price Chart - EUR/USD 120min - Euro vs US Dollar Trade Outlook - Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; EUR/USD on Tradingview

In last week’s Euro Price Outlook we highlighted, “Key resistance / bearish invalidation remains steady at 1.1853/59– a region defined by the 100% extension of the late-September advance and the 61.8% Fibonacci retracement of the September range.” EUR/USD continued to respect this zone on a close basis with price briefly registering a high at 1.1880 before turning lower into the close of October.

Bottom line: That decline is now testing a key support zone at the October 2018 high / 61.8% extension at 1.16.21/33. Initial resistance now back at the 1.17-handle backed closely by the October open at 1.1719- both regions of interest for possible topside exhaustion IF reached. Bearish invalidation now lowered to 1.1786. A break lower from here exposes the lower parallel, currently near 1.1580 with critical confluence support eyed at 1.1482/99.Review my latest Euro Weekly Price Outlook for a look at the longer-term GBP/USD technical trade levels.

Euro Trader Sentiment – EUR/USD Price Chart

Euro Trader Sentiment - EUR/USD Price Chart - Euro vs US Dollar Trade Outlook - Technical Forecast
  • A summary of IG Client Sentiment shows traders are net-short EUR/USD - the ratio stands at -1.04 (49.10% of traders are long) – neutral reading
  • Long positions are22.39% higher than yesterday and 61.17% higher from last week
  • Short positions are12.96% higher than yesterday and 33.96% lower from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EUR/USD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current EUR/USD price trend may soon reverse lower despite the fact traders remain net-short.

Australian Dollar Price Chart - AUD/USD Daily

Australian Dollar Price Chart - AUD/USD Daily - Aussie Trade Outlook - Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; AUD/USD on Tradingview

In my most recent Australian Dollar Technical Price Outlook we noted that AUD/USD, “carving the weekly opening-range just below the monthly open / downtrend resistance – look to the breakout for guidance,” with the broader risk for a deeper setback while below the September trendline. An outside-day reversal off monthly open resistance at 7160 last week takes Aussie back into key support here at 7016/42- looking for infection off this threshold heading into the elections with a break / close below needed to keep the short-bias viable heading deeper into November. Subsequent support objectives at 6963 and the 100% extension at 6835.

Bottom line: Aussie is testing a major support inflection zone here with the broader September downtrend still in play while below 7160. Review my latest Aussie Weekly Price Outlook for a look at the longer-term AUD/USD technical trade levels.

Canadian Dollar Price Chart - USD/CAD 120min

Canadian Dollar Price Chart - USD/CAD 120min - US Dollar vs Canadian Dollar Trade Outlook - Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; USD/CAD on Tradingview

In my latest Canadian Dollar Price Outlook we noted that USD/CAD was approaching, “critical support at 1.3046/56. Ultimately, we’re looking for basing this week with a breach above this formation needed to shift the focus higher again in the US Dollar.” The decline never reached that threshold with USD/CAD turning off the 78.6% retracement at 1.3085 into the close of October trade. The recovery failed last week at confluence resistance at 1.3375/82 and the focus is on this pullback heading into a heavy week of event risk.

Bottom line:Support rests at the lower parallel / 61.8% retracement at 1.3199- look for a reaction there IF reached with a close below 1.3156/62 ultimately needed to mark resumption of the broader downtrend. Weekly open resistance at 1.3313 with a breach higher keeping the focus on 1.3450. Review my latest Canadian Dollar Weekly Price Outlook for a closer look at the longer-term USD/CAD technical trading levels.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

-Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michaelon Twitter @MBForex

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

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