The USDX extended the bullish foot print yesterday. The index approached the 50Dsma at early Asian session today. The US is preparing for the first rate hike forecasted for September or the end of 2015. As of now, the date is not clearly singled but the hike is imminent. This factor made the USDX and USD related pairs bullish like USD/JPY, USD/CAD, and USD/SGD. Today, traders eye on the US core durable goods orders. Manufacturing data returned back in March after seven months of negative readings. We expect April's readings to stay above 0.4%. The CB consumer confidence is due for today. April's readings were lower, 95.2, compared to 101.40 in March. In May, we expect a positive reading above April's data. In case readings meet our expectations, the USDX will extend to 97.30 and 98.40 in a day or two. We initiated bullish view at 93.50 earlier (May 15th article). USD/CAD Ahead of the BOC statement, the pair is trading on a verge of bullish break. We expect the BOC to deliver unchanged stance. After inflation data release, USD gained strong momentum against most majors and USD related pairs. The pair has been facing strong resistance at 50Dsma 1.2350 and 1.2365 100Dsma. The fresh breakout is available above 1.2365 towards 1.2650 initially, and a new high later. We recommended buying at 1.2000 (refer article May 15th) as of now 300 pips mined. Those who bought earlier can book profit at the current levels. We will advise fresh buy in case the price manages to close above 1.2400. Intraday buying opportunity is seen above 1.2325 with targets at 1.2350, 1.2365, and 1.2400. In case of a daily close above 1.2365, bulls will aim at 1.2650. If the price closes the week above 1.2400, bulls will aim at 1.2800. Intraday support is found at 1.2300 and 1.2275.
The US Dollar Index continues its rally higher as expected after the reversal on May 19. The US Dollar Index gave a buy/reversal signal when it broke above the downward sloping wedge. I have been calling for this reversal as the index approached very close to the support of the 38% Fibonacci retracement on a weekly basis.
The US Dollar Index is approaching the 61.8% retracement of a decline from 100. Strong resistance is found at this Fibonacci retracement and I will not be surprised to see a pause of the rise. Important support is at 94.80. The Ichimoku cloud remains below the current price confirming that trend is bullish.
Red line = resistance The US Dollar Index has also reached the Ichimoku cloud resistance on the daily chart. The red line resistance was broken and the price is testing the lower cloud boundary now. If bulls manage to push the price into the cloud, this will be an important step into changing the Ichimoku trend to neutral on the daily chart. My view remains bullish in the longer term.
The US Dollar Index has made a short-term reversal and is showing signs of an imminent pullback. Bulls managed to reach the 61.8% retracement of the decline from 100 to 93.10 and a small pullback is justified here. The upward move from 93.10 is impulsive and this implies that it is more probable that a new upward move has started.
Green line= trend line support The US Dollar Index has short-term support at 96.85 and more importantly at 96.40. Trendline support is at 96-95.80. I believe this is just another corrective pullback before the resumption of the uptrend. I remain longer-term bullish as long as we trade above 94.80.
Black area = support The US Dollar Index has managed to break above the black resistance area that is now support. Bulls have also managed to break inside the Ichimoku cloud and are fighting to stay inside. This is a bullish signal. Daily support is found at 96 and at 95. I believe the correction ended at 93.10 and a new upward move has started. I remain bullish.
The USDX managed to break the resistance zone of 96.97 and now it's focusing to test the next upside target at 98.08. We're at important levels and we should be cautious when trading owing to bullish momentum on the Index. As the current price action is showing that bulls are in control, we should follow this bias.
In the H1 chart, the USDX continues to trade in favor of the upward trend. Also, it's moving sideways, that could mean it could be forming a bullish pattern. In case of success, it has to break the resistance level of 97.60 in order to rally towards the level of 97.97. 200 SMA is still bullish, but the MACD indicator is in the negative territory.
Daily chart's resistance levels: 98.08 / 98.64 Daily chart's support levels: 96.97 / 95.74 H1 chart's resistance levels: 97.16 / 97.97 H1 chart's support levels: 97.16 / 96.90 Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the US Dollar Index breaks with a bullish candlestick; the resistance level is at 97.60, take profit is at 97.97, and stop loss is at 97.25.
The US Dollar Index is reversing lower as expected. I have turned neutral about the dollar in the short term as the price has made an extended impulsive move higher that reached important resistance levels. A pullback towards 96 is justified. However, my long-term view remains bullish targeting at 101-102.
The US Dollar Index is trading above the Ichimoku cloud in the 4-hour chart and the short-term trend is reversing to bearish as a rise from 93.10 seems to be complete. Support is found at 96.30 and 96. The 38% retracement will give us important information as whether we see a deeper correction or a shallow one.
A decline from this year's highs is represented in 3 corrective waves . The impulsive upward move in the US Dollar Index is overlapping March's lows confirming that this upward move is not a wave 4 type correction. The three-wave decline has most probably completed the longer-term wave 4 correction and we are now in the early stages of an upward wave 5 that will bring the index above 102. Wave 1 of 5 is most probably completed, so we need to see a pullback before we jump back into longs.
The US Dollar Index reversed lower as expected. There were signs of a pending reversal a couple of days ago as the extended rise in the US Dollar Index was reaching important resistance levels. The area around 93.10 is of great importance for the bullish scenario. I believe that the pullback will help the price reach 96 and the uptrend will resume. I remain neutral for the short term.
The US Dollar Index is above the Ichimoku cloud in the 4-hour chart. The trend is bearish in the medium term. In the short term, we expect some weakness that could bring the index towards the 38% retracement of a rise from 93.10 that coincides with the 61.8% retracement of a rise from 94.80. This level is at 96. The area between 96.60 and 96 is important short-term support.
In the daily chart, the US Dollar Index paused its rise right at the lower cloud boundary resistance. The index is expected to pullback towards the black area of support, which used to be a resistance level. So, this back test should bring the index towards the area of 96.50-96.
In the week ended on May 23, the advanced figure for seasonally adjusted initial claims was ***,000, showed an increase of 7,000 from the previous week's revised level. Pending home sales rose in April for the fourth straight month and reached their highest level in nine years, according to the National Association of Realtors. On a monthly basis, the US Dollar Index managed to bag more than 2%. On a weekly basis, it added 0.75%. Earlier, we recommended buying at 94.00. The US Dollar Index made a double top at 97.30. Intraday support is found at 96.60 and 96.00. USD/CAD Today, we expect the pair to move actively ahead of GDP data from Canada and prelim GDP. The pair managed to gain approximately 3%. The pair managed to hold the 20Wsma found at 1.2400. In case of today's close above 1.2400, we will expect 1.2650 next week and 1.2800 later. On May 15, we advised buying initially at 1.2000 extending the target at 1.2500. The pair reached a high of 1.2539. Today, the pair opened on a bearish note. The support is found at 1.2400 and 1.2380; resistance is seen at 1.2430 and 1.2455. The pair hit a lower low in the H1 chart after 15 days. The buying opportunity is seen above 1.2460, at 1.2490 and 1.2530. Selling opportunity is expected below 1.2380, at 1.2320 and 1.2300.
As we have been expecting, USDX is currently doing a corrective move in favor of the bullish trend at the daily chart. it also formed a fractal around the resistance level at 98.08, which could be advising us about a possible sideways consolidation for a few days. Now, 200 SMA is still bullish and the MACD indicator is in positive territory.
The USDX still has support at the level of 96.90 where it could perform an intraday rebound until the resistance level at 97.60. The resistance is located around a weekly high. For now, we should expect more corrective movments, but the bullish trend is still alive and we should find some bullish patterns in a coming week to trade.
Daily chart's resistance levels: 98.08 / 98.64 Daily chart's support levels: 96.97 / 95.74 H1 chart's resistance levels: 97.16 / 97.60 H1 chart's support levels: 96.90 / 96.53 Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the US Dollar Index breaks with a bullish candlestick; the resistance level is at 97.16, take profit is at 97.60, and stop loss is at 96.70.
The US Dollar Index is most probably in its 4th wave correction phase. We should expect a new impulsive wave upwards as a part of the fifth wave of the 1st wave up towards new highs. The three wave correction at 93.10 is complete and the reversal is to be confirmed soon with a sequence of 5 waves up from recent lows. A strong pullback should be expected before resumption of the uptrend.
Black lines = bullish channel Red lines = wave 4 correction channel Orange lines = past bearish channel that was broken The US Dollar Index is trading above the Ichimoku cloud. I believe we are in a wave 4 sideways move that will end soon. A new upward wave will start. We expect this upward wave to be most probably wave 5 for a new upward move that started from 93.10. This will complete the 1st wave of the new upward move that is expected to reach new highs. Short-term support is found at 96.70 and short-term resistance is seen at 97.30.
The last two weeks have been very bullish for the US Dollar Index. Bulls have managed to step in and push the price not only above the kijun-sen but also above the tenkan-sen. The retracement at 38% was marginally reached and I believe it is over. A new upward impulsive move has started. We should expect a back test of the red tenkan-sen indicator but my longer-term view remains bullish.
The USDX is doing some pullbacks in favor of the bullish bias, as the Index is trying to break the support level of 96.97 in order to go until 95.74. For now, the bullish road is still alive, but the USDX needs to do corrective moves first to ride the bullish bias.
During the Friday session, we saw some irregular moves of the USDX, because the Index was lagging above the support zone at 96.90. The resistance level of 97.16 could be tested in the coming hours. On the H1 chart, the 200 SMA is bullish and the current structure is advising us about corrective and no trend-changing moves.
Daily chart's resistance levels: 98.08 / 98.64 Daily chart's support levels: 96.97 / 95.74 H1 chart's resistance levels: 97.16 / 97.60 H1 chart's support levels: 96.90 / 96.53 Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the US Dollar Index breaks with a bullish candlestick; the resistance level is at 97.16, take profit is at 97.60, and stop loss is at 96.70.
