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.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Bullish
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Bitcoin
Bearish
More View more
Real Time News
  • RT @ReformedBroker: “The digital yuan China is planning is in fact a complete inversion of the bitcoin model. All of the data created would…
  • The $CAD rose on a hopeful tone from the Bank of Canada, but the largest risk to the central bank’s outlook remains unresolved. NZD/CAD has rallied. Will AUD/CAD follow as CAD/JPY sinks? Get your market update from @ddubrovskyFX here: https://t.co/AairskIHA5 https://t.co/f53ZzloW4u
  • The latest UK General Election opinion polls continue to show the Conservative Party holding a strong lead over Labour and point to Boris Johnson winning a working majority in Parliament. Get your $GBPUSD market update from @nickcawley1 here: https://t.co/qF04EOUWkI https://t.co/LNl4bXbnpp
  • Recent polls have put Conservatives ahead of Labour and given a boost to $GBP. Get your #Brexit update from @ZabelinDimitri here: https://t.co/l2n53C0cYY https://t.co/oTWfXkaDDt
  • What are the truths and myths of #forex trading? Find out from @DailyFX analysts here: https://t.co/uF75VPzstr #FOMOintrading https://t.co/xeromAGqqx
  • Macro data from around the world have long attested to the urgent need for a trade settlement between the US and China. Increasingly the corporate numbers are saying the same. Get your market update from @DavidCottleFX here:https://t.co/Qon7QUO80c https://t.co/rCOG78QQ2M
  • #Gold prices may fall while the US Dollar gains even as economic policies championed by the Trump administration invite inflation. Get your market update from @IlyaSpivak here: https://t.co/4lHhHsby56 $XAUUSD https://t.co/JmZxckVHdS
  • Cable (GBP/USD) remains just off its seven-month high print around 1.3165 as traders start to move to the side lines ahead of next Thursday’s General Election vote. Get your $GBPUSD market update from @nickcawley1 here: https://t.co/CpCh13J9ZH #Brexit https://t.co/PIh6WUqbsK
  • (Weekly Technical Outlook) GBP/USD, EUR/GBP, GBP/JPY, GBP/CAD Outlook as UK Election Looms $GBPUSD $EURGBP $GBPJPY #UKelection2019 - https://www.dailyfx.com/forex/technical/article/fx_technical_weekly/2019/12/07/GBPUSD-EURGBP-GBPJPY-GBPCAD-Outlook-as-UK-Election-Looms.html?CHID=9&QPID=917702 https://t.co/iuILHYczJ7
  • Why do you require consistency in trading and why does it matter? Find out: https://t.co/WlEFlluGfZ #tradingstyle https://t.co/TkMtJQKatx
EUR/USD, USD/JPY Hint at Ugly Potential for USDOLLAR Index

EUR/USD, USD/JPY Hint at Ugly Potential for USDOLLAR Index

2016-02-09 13:17:00
Christopher Vecchio, CFA, Sr. Currency Strategist
Share:

Talking Points:

- EUR/USD consolidation after breakout looks like a bull flag.

- USD/JPY head & shoulders topping pattern gaining credibility.

- As market volatility rises, it's a good time to review the "Traits of Successful Traders" series.

The USDOLLAR Index is treading water today, but the rebound from the lows around Friday's US labor market report looks weak at best. Momentum indicators (daily MACD and Slow Stochastics) are starting to turn lower into bearish territory, and price is now treating the daily 8-EMA as trend resistance. There isn't much agreement among the components of the USDOLLAR Index either: AUD/USD and GBP/USD are moving in one direction; while EUR/USD and USD/JPY are moving in another.

There seems to be a "risk on/off" theme at play: the Asian-linked commodity currencies and the British Pound ('Brexit'/EU referendum threat) are suffering; the Euro and the Japanese Yen are gaining ground. Markets are exhibiting a shift in risk preferences across the board: lower yielding, more liquid currencies are being bought up in favor of those with greater geopolitical or macroeconomic risk. As such, today's doji candle - pause in trend - may be inherently misleading.

While AUD/USD and GBP/USD suggest further weakness in risk-correlated assets, EUR/USD and USD/JPY are suggesting that more pain may be ahead for the greenback. EUR/USD is exhibiting a breakout retest in the form of a bull flag on its H4 timeframe that's aiming for $1.1450/1.1530; USD/JPY appears to be triggering a head & shoulders topping pattern that points towards ¥106.00/25.

See the above video for technical considerations in EUR/USD, GBP/USD, AUD/USD, USD/JPY, AUD/JPY, GBP/JPY, and the USDOLLAR Index.

Read more: February Seasonality Gives US Dollar Rebound Hope Next Few Weeks

--- Written by Christopher Vecchio, Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com.

Follow him on the DailyFX RTN, Twitter, and Stocktwits at @CVecchioFX.

To be added to Christopher’s e-mail distribution list, please fill out this form.

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

DISCLOSURES

News & Analysis at your fingertips.