US Dollar Talking Points:
- The US Dollar set a fresh two-year-high on the first trading day of Q4.
- Prices have since pulled back, helped by negative US data from last week.
- Going along with that USD pullback has been a retracement in EUR/USD to a key level of resistance around the 1.1000 handle.
- DailyFX Forecasts are published on a variety of markets such as Gold, the US Dollar or the Euro and are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.
US Dollar Reversal Continues
We’re now a week into Q4 trade and the US Dollar continues to show signs of reversal. The Greenback came into Q4 with a full head of steam, rushing up to fresh two-year-highs last Tuesday to mark the Q4 open. But, since then, a series of bad US data prints has taken the air out of those sails, and the USD continues to pull back, now working on the fifth consecutive day of losses to begin Q4 trade.
This echoes the view from our Q4 technical forecast on the US Dollar, in which a rising wedge formation was coupled with a very interesting fundamental backdrop around the US currency. As US data continues to print in a rather negative manner, shown last week in both services and manufacturing ISM reports to go along with flat Average Hourly Earnings from NFP, the potential for a deeper pullback in the US currency remains as we trade deeper into the final quarter of 2019.
US Dollar Daily Price Chart
Chart prepared by James Stanley; US Dollar on Tradingview
EUR/USD Tests Trendline Resistance at 1.1000
As looked at in last Thursday’s webinar, this pullback in the US Dollar has allowed for a retracement in EUR/USD after the pair came into Q4 rushing down to fresh two-year-lows. The area around 1.1000 is confluent as a psychological level and a prior area of support, and just a bit higher is a trendline projection as taken from June, August and September swing-highs.
EUR/USD Four-Hour Price Chart
Chart prepared by James Stanley; EURUSD on Tradingview
To read more:
Are you looking for longer-term analysis on the U.S. Dollar? Our DailyFX Forecasts have a section for each major currency, and we also offer a plethora of resources on Gold or USD-pairs such as EUR/USD, GBP/USD, USD/JPY, AUD/USD. Traders can also stay up with near-term positioning via our IG Client Sentiment Indicator.
Forex Trading Resources
DailyFX offers an abundance of tools, indicators and resources to help traders. For those looking for trading ideas, our IG Client Sentiment shows the positioning of retail traders with actual live trades and positions. Our trading guides bring our DailyFX Quarterly Forecasts and our Top Trading Opportunities; and our real-time news feed has intra-day interactions from the DailyFX team. And if you’re looking for real-time analysis, our DailyFX Webinars offer numerous sessions each week in which you can see how and why we’re looking at what we’re looking at.
If you’re looking for educational information, our New to FX guide is there to help new(er) traders while our Traits of Successful Traders research is built to help sharpen the skill set by focusing on risk and trade management.
--- Written by James Stanley, Strategist for DailyFX.com
Contact and follow James on Twitter: @JStanleyFX
