Technical Outlook for USD, Cross-rates, Gold Price & More

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We began today’s session discussing today’s FOMC announcement. There aren’t expectations of a rate hike today and only a less than 10% chance in September. On that, markets aren’t too concerned but any material changes in the policy statement could change that. EURUSD has been extremely strong, but yesterday’s key reversal at the August 2015 low does put a damper on momentum. We’ll be watching to see if it can have downside follow-through or negate the bearish candle and forge new multi-year levels. USDJPY reversed off trend-line support on Monday and shifts focus higher in the short-term. USDCAD is quickly approaching an area which could be of interest soon should we see a bullish reversal. It would only be a retracement trade, but could have a strong rebound given how far down its been driven.

We looked at a couple of short-term trades, both shorts. One in CHFJPY, but only for a quick-hitter. The other in EURCAD which is pushing lower off a confluence of resistance. USDMXN is very near a ‘sell-zone’ and with proper price action may come a trade.

Turning to precious metals, gold is turning lower from a very important area around the 2011 trend-line and 1260s. The thinking on this end is that gold has another leg lower coming soon, and it may have already begun this week. Silver is also looking lower, with the 2003 trend-line in focus on the downside beneath 15.

Crude oil blew through the 47-threshold we’ve been watching. Will it gain more upside momentum or carve out a corrective pattern? Time will tell, but we’re going to be patient in waiting for further developments before jumping to any further conclusions.

Indices continue to be a mess with volatility low. Without any major catalyst, a summer-trading environment is expected as August quickly approaches. The S&P 500 is hanging out near record highs with no signs of rolling over, while the DAX still sits precariously around the neckline of an H&S pattern and April gap. The FTSE 100 is a chop-fest in the short-term, but the longer-term trend remains intact.

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---Written by Paul Robinson, Market Analyst

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