US Dollar Price Action Setups: EUR/USD, GBP/USD, AUD/USD, USD/JPY
US Dollar Talking Points:
- The US Dollar has shown bearish reversal tendencies so far in the early-portion of Q4.
- Tomorrow brings Non-Farm Payrolls and heavy focus will likely continue to be paid towards US data in the effort of reading just how dovish the FOMC might be.
- DailyFX Forecasts are published on a variety of markets such as Gold, the US Dollar or the Euro and are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.
US Dollar Q4 Reversal Continues
The US Dollar has started Q4 with a pullback and that theme runs into tomorrow’s big item on the economic calendar, Non-Farm Payrolls for the month of September. US data for this week has been poor and this has taken a toll on both the US Dollar and US equities, keeping the door open for wider pullbacks in each market for Q4. This would be similar to the backdrop seen around last year’s Q4 open, when a Fed that wasn’t dovish enough was firmly in the spotlight as risk markets lost their bid and began to pullback. In this webinar, I looked at a variety of markets in anticipation of tomorrow’s NFP report and thereafter, looking to work with trends on either side of the US Dollar while also keeping focus of some key commodity markets.
The US Dollar Weekly Price Chart
EUR/USD Tests Resistance at 1.1000
I had looked at resistance on EUR/USD on Tuesday around the 1.1000 handle. That’s since come back into play, offering a bit of confluence with a bearish trendline projection.
EUR/USD Eight-Hour Price Chart
GBP/USD: Cable Questions After Messy Past Week
As I had looked at on Tuesday, the support break in GBP/USD brought the bullish theme into question. Now that USD-weakness has gotten a bit louder, buyers have gotten back on the bid in GBP/USD to push back above the 1.2300 handle. This is still far from a settled manner but taking shorter-term price action can allow for a bullish backdrop, looking for a higher-low support hold in the zone that runs from 1.2324-1.2343.
GBP/USD Two-Hour Price Chart
AUD/USD Bounces From Support Test at .6700, Tests Short-Term Resistance
On the long side of the US Dollar, AUD/USD remains attractive. As looked at on Tuesday, the support area just below the .6700 handle hasn’t yet shown signs of giving up. Taking this recent bout of USD-weakness into account, a counter-trend move has developed that’s pushed prices back to resistance as taken from prior support. This can keep the short-side of the pair as attractive, particularly for long-USD strategies ahead of tomorrow’s NFP report.
AUD/USD Four-Hour Price Chart
USD/JPY: Bearish Potential
This one syncs with the potential for greater risk aversion, and resistance potential exists around the prior area of support, taken from around the 107-handle.
USD/JPY Two-Hour Price Chart
To read more:
Are you looking for longer-term analysis on the U.S. Dollar? Our DailyFX Forecasts have a section for each major currency, and we also offer a plethora of resources on Gold or USD-pairs such as EUR/USD, GBP/USD, USD/JPY, AUD/USD. Traders can also stay up with near-term positioning via our IG Client Sentiment Indicator.
Forex Trading Resources
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--- Written by James Stanley, Strategist for DailyFX.com
Contact and follow James on Twitter: @JStanleyFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.