Forex Trading Library

Intraday Analysis – USD in need of catalyst

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USDCHF struggles to bounce

The US dollar recoups some losses as traders reposition ahead of April’s jobs data. The recent bounce has again hit resistance at the psychological level of 0.9000, making this double top a major ceiling in the short-term. A fall below 0.8860 suggests that the bears are still in control of the price action and may sell into strength at the next rebound. Offers could be expected at the support-turned-resistance of 0.8920. Another round of sell-off may send the greenback to the January 2021 lows around 0.8760.

USDCAD breaks support

The Canadian dollar rallied after the BoC governor hinted at more rate hikes if inflation became entrenched. The pair has met some selling pressure in the supply zone from the start of the late March sell-off at 1.3660. A tentative break below 1.3530 next to the daily SMAs would dent the short-term optimism and trigger an extended consolidation in the medium-term with 1.3400 as a potential target. On the upside, 1.3580 is an intermediate resistance and only a close above 1.3660 would resume the recovery towards 1.3800.

SPX 500 tests key support

The S&P 500 slips as PacWest’s distress fuels fears of a deeper bank crisis. The index came to a halt at this year’s high of 4190 and a subsequent fall below 4115 is a sign of liquidation, suggesting that a correction could be on its way. The lack of strength above 4140 as shown by a doji candle indicates that the path of least resistance is down, with that level turning into a fresh resistance. The daily swing low of 4050 is buyers’ last stronghold and its breach would trigger a broader sell-off to the psychological level of 4000.

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