0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bullish
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
Wall Street
Mixed
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • 🇨🇳 FDI (YTD) YoY (JUL) Actual: 0.5% Previous: -1.3% https://www.dailyfx.com/economic-calendar#2020-08-13
  • Have you been catching on your @DailyFX podcast "Global Markets Decoded"? Catch up on them now, before new episodes release! https://t.co/Twr44cZ1GB https://t.co/6b3JtrSQnP
  • Join @PaulRobinsonFX 's #webinar at 5:30 AM ET/9:30 AM GMT to learn about how you can become a better trader. Register here: https://t.co/WeWGKtdlyz https://t.co/4hIQtGPL0N
  • Gold Prices May Resume Selloff After Digesting Largest Drop in 7 Years - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2020/08/13/Gold-Prices-May-Resume-Selloff-After-Digesting-Largest-Drop-in-7-Years.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Spivak&utm_campaign=twr #XAUUSD #gold https://t.co/aWOvE1KJXc
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.83%, while traders in US 500 are at opposite extremes with 77.46%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/EQ77jevtaX
  • Heads Up:🇫🇷 IEA Oil Market Report due at 08:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-08-13
  • Hey traders! I'm sure you've all heard about trend trading. Sharpen your knowledge here: https://t.co/jkliL5sxj7 https://t.co/QPW1os7wbE
  • Commodities Update: As of 07:00, these are your best and worst performers based on the London trading schedule: Silver: 0.98% Gold: 0.60% Oil - US Crude: -0.18% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/gDZGfvBOHv
  • Forex Update: As of 07:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: 0.31% 🇨🇭CHF: 0.22% 🇬🇧GBP: 0.21% 🇦🇺AUD: -0.01% 🇨🇦CAD: -0.03% 🇳🇿NZD: -0.20% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/9IwXKOUieT
  • Indices Update: As of 07:00, these are your best and worst performers based on the London trading schedule: Wall Street: -0.16% US 500: -0.17% Germany 30: -0.24% France 40: -0.50% FTSE 100: -0.96% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/MtMyrT3zZY
DXY Index Runs into Symmetrical Triangle Resistance and Rally Halts

DXY Index Runs into Symmetrical Triangle Resistance and Rally Halts

2019-02-07 16:22:00
Christopher Vecchio, CFA, Senior Strategist
Share:

Talking Points

- The DXY Index rally has run into its first obstacle in its week-long march higher, hitting triangle resistance as well as the January 24 swing high.

- Meanwhile, with the US Dollar rally hitting pause, Gold prices have ceased their pullback and remain within the confines of the November 28 and December 14 uptrend.

- Retail traders have consistently sold the US Dollar over the past week; net-shorts have risen considerably in EURUSD and GBPUSD.

Looking for longer-term forecasts on the US Dollar? Check out the DailyFX Trading Guides.

The US Dollar (via the DXY Index) rally is taking a breather for the first time in a week after failing to crack through key consolidative resistance that’s defined trading thus far in 2019. The symmetrical triangle in place since the start of the year has been maintained for now, and a lack of clear catalysts over the coming sessions suggests that prices may well stay constrained through the end of the week. The greenback’s earlier gains were propelled not by its own bullish factors but rather a deterioration in conditions for two of the DXY Index’s largest components, the British Pound and the Euro.

For the British Pound, the Bank of England rate decision produced no change in rates, but the Quarterly Inflation Report was clearly tilted dovish amid cuts to both the growth and inflation forecasts. Against the backdrop of the EU-UK Brexit talks having hit an impasse, rates markets have effectively priced out any BOE tightening in 2019. GBPUSD’s technical indicators have indeed started to rollover, but this pair (as all GBP-crosses) carries the Brexit caveat (making technicals less reliable).

For the Euro, the European Commission cuts to the 2019 GDP forecast underscore what has been a deteriorating growth environment for some time. As discussed in the Euro weekly trading forecast, economic data momentum remains exceptionally weak and inflation expectations continue to drop. The European Central Bank’s dictum that it needs “more monetary evidence” before pursuing another stimulus program may soon be fulfilled.

At a minimum, traders should be looking for ECB officials to start pushing back on their current timeline to raise rates around “summer 2019,” much to the chagrin of ECB President Mario Draghi (whose term expires in October 2019 and would like to end extraordinary easing measures before he leaves (i.e. declare victory)). There will be more pain ahead of EURUSD (as well as other EUR-crosses) as long as the ECB fails to recognize its own policy shortcomings.

DXY Index Price Chart: Daily Timeframe (June 2018 to February 2019) (Chart 1)

DXY Index Runs into Symmetrical Triangle Resistance and Rally Halts

The DXY Index has run into topside resistance outlined earlier this week, coming into play near 96.45/50 (triangle) and 96.68 (January 24 swing high). A weekly close above the January 24 high would be preferred for confirmation that a breakout has started to transpire. Momentum indicators are starting to perk up, with Slow Stochastics moving into bullish territory and daily MACD close to flipping above its signal line. Meanwhile, the daily 8-, 13-, and 21-EMA is back in bullish sequential order.

In the event of a bullish breakout, the triangle base at 96.96 would be eyed initially before an ultimate return back to the October 2018-January 2019 range highs near 97.72. Otherwise, until bullish confirmation is achieved, traders would be well-suited to remain patient. After all, such a consolidative pattern dictates patience by traders, as well as an open mind to resolutions on either side of the triangle.

Read more: DXY Index Rallying in Confines of Triangle; Gold Pullback Under Way

FX TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

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

Follow him on Twitter at @CVecchioFX

View our long-term forecasts with the DailyFX Trading Guides

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

DISCLOSURES

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.