Forex Trading Library

Intraday Market Analysis – USD loses support

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EURUSD regains traction

The US dollar plunged after Fed Chairman Powell signalled a slowdown in rate hikes. A close above the recent high of 1.0450 was an encouraging sign that the optimism is still prevailing. But the psychological level of 1.0500 has caused some profit-taking, weighing on the rebound. After a bounce off 1.0300 and above 1.0390, a retest of 1.0500 and a bullish breakout would carry the single currency to its 5-month high (1.0600) against the US dollar. Further down, 1.0220 near the 30-day moving average is a critical floor.

USOIL tests resistance

Oil prices find support from a large drawdown in US inventories. Sentiment remains cautious at best after WTI broke below September’s low of 76.60. The RSI’s repeatedly oversold condition attracted some bargain hunters. 81.70 from a previously faded rebound is the first key resistance. Then the area of confluence at 84.50, a support-turned-resistance which coincides with the 30-day moving average, may see offers from medium-term bears. A drop below 77.00 could renew the selling pressure.

UK 100 breaks major resistance

Equities take off as investors price in lower peak US funds rates. The FTSE 100 broke above last August’s high of 7575, which may lay the foundation for an extension in the weeks to come. On the daily chart, the triple top around 7650 is sellers’ last stronghold and a breakout would be significant after a near nine-month long consolidation. The bears may look to switch sides and offer support for a bullish continuation. As the RSI ventures into overbought territory, 7550 is the first level to expect follow-up interests in case of a pullback.

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