Technical Outlook:
- EUR/USD breaking out above resistance
- EUR/JPY crossing above solid level
- DXY headed back towards test of long-term levels
EUR/USD is crossing above confluent resistance via a trend-line off the September 1 high and minor swing lows in place since the third week of August. A move may be in the works back towards the highs at around the 12000 mark. There is a chance the underside of a previous channel acts as resistance, but it isn’t seen as the biggest threat right now given the line is angled in the direction of the current move.
EUR/USD Daily Chart (crossing resistance)
EUR/JPYis trying to cross above sizable resistance in the 12440s, a spot that came into play as a result of the top in June. Since then it acted as support on a few occasions (& neckline of a prior H&S pattern). A little more clearance and a run back to the 2014 trend-line (~12650) can continue.
EUR/JPY Daily Chart (looking to push above resistance)
The US Dollar Index (DXY)is breaking below support created as a result of several minor peaks running over from August and the lower parallel of a channel line off the September 1 low. This is seen as putting the DXY at risk of again testing the 2011 trend-line/1998 horizontal combo. This would be a huge test.
DXY Daily Chart (looking towards long-term support)
DXY Weekly Chart (2011 trend-line/1998 horizontal support)
For all the charts we looked at, check out the video above…
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
