- Trade setups we’re tracking across the USD Majors / Commodities this week
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US Dollar Recovery Could be Short-lived – Gold Rally Vulnerable Near-term
The US Dollar Index has continued to contract within the initial monthly range and despite Friday’s rally, the greenback remains within the confines of the broader range we’ve been tracking. The Euro, Sterling, Loonie and Aussie are all at / approaching critical pivot / inflection zone and we’re looking for a reaction in price this week. Meanwhile, the Gold price breakout looks a bit vulnerable after responding to a major resistance target last week – while the broader outlook remains higher, we’re expecting some kickback here. In this webinar we review updated technical setups on DXY, EUR/USD, GBP/USD, USD/CAD, AUD/USD, NZD/USD, GBP/NZD, Gold, Silver, Crude Oil (WTI), BTC (Bitcoin), TNX (10yr Treasury Yield), USD/JPY and SPX (S&P 500).
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Key Trade Levels in Focus
DXY – Focus is on a break of the monthly opening-range. Key resistance / near-term bearish invalidation at 97.50. Critical support steady at 96.51/58 – a break there would exposes 96.61 and yearly open support at 96.14.
EUR/USD – Critical support at 1.1182/87 – looking for an exhaustion into this zone IF price is heading higher. Resistance at Friday’s high backed by 1.1303 & 1.1329. A break lower exposes the low-close at 1.1129 backed by the yearly low at 1.1108.
NZD/USD – The Kiwi breakout looks precarious here near-term after taking out targets into 6766 – Risk for some pullback early in the week but the trade remains constructive while above 6705. Subsequent topside resistance objectives at 6805 and 6843.
USD/CAD – We’ve been looking for some recovery off a critical weekly support zone at 1.2972-1.3052 with the July opening-range still intact. A breach / close above 1.3145 would be needed to alleviate further downside pressure (near-term bearish invalidation).
Gold – Gold prices are at risk for some kickback here after taking out topside targets into 1451 last week. Monthly open support rests at 1409 with near-term bullish invalidation at 1400. A topside breach keeps the focus on subsequent resistance objectives at 1467 and 1482.
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy
Key Event Risk This Week
Economic Calendar - latest economic developments and upcoming event risk
---Written by Michael Boutros, Currency Strategist with DailyFX
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