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Dollar Looking for May High: Euro, Pound, Aussie Charts & More

Dollar Looking for May High: Euro, Pound, Aussie Charts & More

Paul Robinson, Strategist

The U.S. Dollar Index (DXY) is positioned to trade higher soon if near-term resistance can be overcome. The Euro will help lead the USD charge, with EURUSD breaking support. GBPUSD isn’t posting much of a bounce off of a long-term trend-line. AUDUSD is faring better but that could change with the triggering of a bearish-looking corrective pattern.

Technical Highlights:

  • U.S. Dollar Index (DXY) looking to break higher soon
  • EURUSD support breaking, 11100 or worse could be nearing
  • GBPUSD is teetering on October 2016 trend-line
  • AUDUSD corrective wedge forming
  • Bonus Chart: EURGBP

For forecasts and educational guides, check them out on the DailyFX Trading Guides page.

U.S. Dollar Index (DXY) looking to break higher soon

The U.S. Dollar index has ben holding up relatively well since finding a low in June. Resistance lines running lower from last month and May are under siege at the moment. A full clearance above these and the July 9 high at 9759 should get the Dollar rolling higher towards the May high at 9837. Undermining this outlook would be a break below last week’s low at 9667.

US Dollar Index (DXY) Daily Chart (looking higher)

US Dollar Index (DXY) Daily Chart (looking higher)

EURUSD support breaking, 11100 or worse could be nearing

The Euro is breaking down below recent support immediately around 11200. If today’s break holds then look for more weakness to follow in-line with a bullish DXY outlook. May/June lows and underside trend-lines just above the 11100-threshold will be targeted. That is only 80-some pips away, but in this current low-vol environment that is the type of room we are working with.

EURUSD Daily Chart (gunning for 11100 or worse)

EURUSD Daily Chart (gunning for 11100 or worse)

GBPUSD is teetering on October 2016 trend-line

Cable continues to teeter on the October 2016 flash-crash trend-line, with limited buying interest. A firm drop below may be nearing. The only bullish scenario in view right now is a falling wedge, but this could also lead to an acceleration lower. Will need to wait for the top-side trend-line off the pattern to break before gearing up on bullish bets.

GBPUSD Weekly Chart (Oct ’16 t-line)

GBPUSD Weekly Chart (Oct '16 t-line)

GBPUSD Daily Chart (price action weak so far, could triangulate further)

GBPUSD Daily Chart (price action weak so far, could triangulate further)

AUDUSD corrective wedge forming

AUD has held up relatively well versus USD, but that could soon change if trend resistance remains a problem and the corrective-looking wedge triggers. A drop through the bottom-side trend-line of the pattern should have things rolling downhill again. A sustained break above 7082 and 200-day will be needed to undermine the current bearish technical set-up.

AUDUSD Daily Chart (corrective wedge forming

AUDUSD Daily Chart (corrective wedge forming

Bonus Chart: EURGBP 4-hr chart (Channel breaking, H&S forming)

Bonus Chart: EURGBP 4-hr chart (Channel breaking, H&S forming)

Resources for Forex & CFD Traders

Whether you are a new or an experienced trader, DailyFX has several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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