Forex Review: EUR/USD, GBP/USD, USD/JPY, USD/CAD, DXY
Alexandros Yfantis | May 16, 2016 07:01AM ET
Good morning to all and a happy week ahead….
EUR/USD
EUR/USD got rejected at the cloud resistance last week near 1.1450 and gave new lows. The bearish flag projection is targeting 1.12. I remain bearish for now.
Price is expected to move at least towards the Kumo support at 1.1240-1.1260 area, but a reversal and break above 1.1450 will open the way for 1.16-1.17.
GBP/USD
With many contradicting views on the effects on the pound after the Remain-Leave June referendum, I see some more bearish short-term potential for this pair, but with very big upside longer-term signals running.
Price has broken below the Kumo in the 4-hour chart and has also broken the bearish flag pattern to the downside with target near 1.41.
The daily chart shown below shows an important breakout above the cloud resistance, and with daily cloud support at 1.4250, I believe this is a more possible target for a bullish reversal.
USD/JPY
Price continues to trade inside the bullish channel. I expect at least one more final push towards 110-110.50. This scenario is valid as long as price is above 108.20
USD/CAD
As I have mentioned in a previous post, my target is at least 1.33. Price has broken out of the downward sloping bearish channel, pulled back to back test support and I believe soon we will see the next leg up towards 1.33.
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Above 1.2970 we should see 1.30-1.31, while a break below 1.2780 will detail the upward move and may push price near 1.27 before the next upward move. I remain longer-term bullish the USD/CAD.
In general I believe we might have seen a longer-term low in the dollar and some serious upside is waiting. Recent lows in the dollar index should not be breached, and resistance at 96.50 at the dollar index should be broken.
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