Short-term Trading Outlook for USD, Euro, Yen & Various Cross-rates
The bounce in USD is at an important near-term cross-road, with EUR/USD testing trend-line support as well as other USD-pairs at key inflection points. USD/JPY bounce may be over, CHF/JPY heading for a breakdown. EUR/CAD and others examined…
- US Dollar Index (DXY) at trend resistance, EUR/USD at support
- Yen decline might be nearing an end; USD/JPY, CHF/JPY in focus
- EUR/CAD at confluence of resistance, waiting on bullish channel break
For longer-term technical and fundamental analysis, and to view DailyFX analysts’ top trading ideas for 2018, check out the DailyFX Trading Guides page.
US Dollar Index (DXY) at trend resistance, EUR/USD at support
Since putting in a low on Friday, the US Dollar Index (DXY) has undergone what appears to only be a corrective bounce. The rally has brought it to trend-line resistance, with its largest constituent, EUR/USD, declining into trend-line support.
Initially looking for the euro to hold trend support and push higher. If it does, there is significant resistance, though, via the 2008 trend-line which has put a lid on an advance three times in less than a month. A scenario we discussed, was for EUR/USD to wedge up between the 2008 trend-line and December trend-line before making a strong one-way move.
EUR/USD Daily Chart
Yen decline might be nearing an end; USD/JPY, CHF/JPY in focus
USD/JPY has put in a nice-sized bounce since Friday morning, but is up against a strong amount of resistance from 10740 to 10810 (short-term trend-line, underside of 2012 trend-line, horizontal price level). The rally in JPY looks like it is ready to stall, bringing a couple of cross-rates into focus.
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USD/JPY Daily Chart
CHF/JPY is trading right around a trend-line from September 2016 and just above one dating back to November. A break of the 2016 trend-line is likely to lead to a break of the shorter-term line. Adding to this notion is the development of a descending wedge on the 4-hr chart. A decline will bring pressure on lows created from November to January from 11373 down to 11295.
CHF/JPY 4-hr Chart
EUR/CAD at confluence of resistance, waiting on bullish channel break
EUR/CAD is trading a trio of resistance lines; 2008 trend-line (drawn at 2 angles), top-side from September 2016, and a top-side from August 2017. The confluence is formidable, but for confirmation that the path of least resistance has turned lower looking for the bullish channel structure on the 4-hr to break, first. A rejection of resistance, break of bullish trend structure should have the cross moving in reverse.
EUR/CAD Daily Chart
EUR/CAD 4-hr Chart
Other pairs we looked at included: GBP/USD, AUD/USD, NZD/USD, USDCAD, USD/CHF, AUD/NZD, EUR/GBP, GBP/JPY, AUD/JPY, NZD/JPY, USD/ZAR, and a few others. For technical and trading considerations, please see the video above…
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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.