Trading Outlook for EUR/USD, USD, Gold Price & More
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Finally, we got the breakdown below the ‘neck-line’ the ‘head-and-shoulders’ pattern in EUR/USD we’ve been discussing extensively as of late. It suggests the euro will have a material decline, with a projected target down around 11240. It’s not just the euro that is set to decline, but currencies across the board are already getting hit or poised to take it on the chin versus the dollar. AUD, NZD, CAD (commodity currencies), and CHF have been exhibiting considerable weakness, and with them EUR is joining in and GBP, if support around 13000 doesn’t hold, will likely gain downward momentum of its own. The hold-up is JPY, with USD/JPY trading at a cross-road of resistance from three different angles. But if it can cross above the mid-11400s with conviction it could be off and running.
We only touched on cross-rates today as most of them aren’t holding very high conviction set-ups. We looked at EURAUD, EURNZD, GBPAUD, GBPNZD, as well as a handful of Yen-crosses. USDMXN is at a big cross-road around current levels by way of an underside retest of a long-term trend-line and horizontal resistance. Looking for it to pull back from here.
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With the now surging dollar, gold and silver are under pressure. Gold continues to work towards the confluence of support around 1260. The picture in silver is a little less clear. The DAX and CAC both received big boosts yesterday on the back of a dovish ECB and have broken on through key resistance levels. The S&P 500 is struggling, but it only appears as though right now we will see a minor correction at the most, which may be more about time than lower prices. On Tuesday at 9 GMT time, we’ll delve more into the specifics pertaining to equity indices and commodities.
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.