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. See our updated Privacy Policy here.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
Oil - US Crude
Wall Street
More View more
Real Time News
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here:
  • 🇬🇧 Retail Sales YoY (MAY) Actual: 24.6% Expected: 29% Previous: 42.4%
  • 🇬🇧 Retail Sales ex Fuel YoY (MAY) Actual: 21.7% Expected: 27.3% Previous: 37.7%
  • Heads Up:🇬🇧 Retail Sales ex Fuel YoY (MAY) due at 06:00 GMT (15min) Expected: 27.3% Previous: 37.7%
  • Heads Up:🇬🇧 Retail Sales YoY (MAY) due at 06:00 GMT (15min) Expected: 29% Previous: 42.4%
  • There are three major forex trading sessions which comprise the 24-hour market: the London session, the US session and the Asian session. Learn about the characteristics of each session here:
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Gold are long at 84.50%, while traders in France 40 are at opposite extremes with 79.56%. See the summary chart below and full details and charts on DailyFX:
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here:
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: 0.09% 🇨🇭CHF: 0.06% 🇯🇵JPY: 0.03% 🇬🇧GBP: -0.01% 🇦🇺AUD: -0.01% 🇳🇿NZD: -0.06% View the performance of all markets via
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: France 40: 0.14% US 500: 0.07% Wall Street: 0.04% Germany 30: -0.04% FTSE 100: -0.11% View the performance of all markets via
USD Index To Maintain Upward Trend, Euro To Complete Reversal Pattern

USD Index To Maintain Upward Trend, Euro To Complete Reversal Pattern

David Song, Strategist





Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index






USD_Index_To_Maintain_Upward_Trend_Euro_To_Complete_Reversal_Pattern_body_ScreenShot055.png, USD Index To Maintain Upward Trend, Euro To Complete Reversal Pattern

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) is 0.48 percent lower from the open after moving 108 percent of its average true range, and we may see the short-term correction gather pace as the greenback fails to maintain the upward trending channel from earlier this week. In turn, the index may fall back towards 9,900, but we should see the dollar consolidate once Europe goes offline as it remains oversold. As the economic docket for the following week is expected to encourage an improved outlook for the U.S., a slew of positive developments should help to prop up the greenback, and we may see the dollar regain its footing going into April as the central bank talks down speculation for more quantitative easing.

USD_Index_To_Maintain_Upward_Trend_Euro_To_Complete_Reversal_Pattern_body_ScreenShot056.png, USD Index To Maintain Upward Trend, Euro To Complete Reversal Pattern

Indeed, St. Louis Fed President James Bullard held a hawkish tone while speaking on Bloomberg Television, stating that the ‘ultra-easy’ policy heightens the risk for inflation, and argued that monetary policy may be at a ‘turning point’ as he sees the central bank normalizing policy in late 2013. As the stickiness in price growth paired with the more robust recovery raises the risk for inflation, we may see the FOMC ultimately drop its 2014-pledge, and the central bank may continue to ramp up its fundamental assessment for the world’s largest economy as the recovery gets on a more sustainable path. However, the committee may look to extend ‘Operation Twist’ amid the ongoing weakness in the housing market, and we may see the central bank gradually lift the interest rate off the record-low while further dampening long-term rates in an effort to balance the risks for the region. Although we maintain a bullish call for the USD, we may see the correction gather pace next week as the relative strength index threatens the upward trend from earlier this year, but the index looks to be carving out a higher low in March as it continues to bounce along the 61.8 percent Fibonacci retracement around 9,949.

USD_Index_To_Maintain_Upward_Trend_Euro_To_Complete_Reversal_Pattern_body_ScreenShot057.png, USD Index To Maintain Upward Trend, Euro To Complete Reversal Pattern

All four components advanced against the greenback, led by a 0.58 percent rally in the Australian dollar, while the Euro gained 0.55 to mark a fresh weekly high of 1.3292. However, as the fundamental outlook for the euro-area remains bleak, we are still watching for a head-and-shoulders top in the EURUSD, and the major reversal pattern should continue to take shape as long as the pair holds below the 2/9 high (1.3320). As the region continues to face a risk for a major economic downturn in 2012, the European Central Bank may have to do more to avoid a prolonged recession, and we are likely to see the Governing Council keep the door open to expand its balance sheet further as the governments operating under the single currency become increasingly reliant on monetary support. As the EURUSD maintains the range from earlier this month, we should see the pair continue to carve out the right shoulder, and we will need a break and a close below 1.3200 to see the reversal pattern play out.

--- Written by David Song, Currency Analyst

To contact David, e-mail Follow me on Twitter at @DavidJSong

To be added to David's e-mail distribution list, send an e-mail with subject line "Distribution List" to

Join us to discuss the outlook for the major currencies on the DailyFX Forums

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