Forex Trading Library

Intraday Analysis – USD looks to break out

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EURUSD awaits breakout

Chart of EURUSD

The US dollar stays rangebound as traders await the April CPI data. On the daily chart, the pair is grinding along the dynamic support from the 20 and 30-day SMAs. As sentiment remains upbeat from the medium-term perspective, the consolidation could be an opportunity to accumulate for the bulls before another leg of rally. A close above 1.1050 may attract momentum buyers and carry the single currency beyond 1.1100. On the downside, the demand zone 1.0910-1.0940 is key in keeping the bullish bias intact.

USDCAD tests critical floor

Chart of USDCAD

The Canadian dollar finds support from oil prices’ bounce as the US plans to replenish its strategic reserve. As the pair gave up all its recent gains, a retest of the critical floor of 1.3300 has put the buy side under renewed pressure. Its breach would force those who bought the dips to dump their positions and stir up volatility. The RSI’s oversold condition has led sellers to take some profit but may not be enough to trigger a bounce. 1.3460 is the first resistance and 1.3550 the major hurdle to lift before a recovery could take shape.

UK 100 goes into correction

Chart of UK100

The FTSE 100 retreats as the market expects a 25 basis points rate hike from the BoE. The rally came to a halt in the supply zone 7930 from the March sell-off and the downward drift is a sign of exit by those who bought on the way up last month. Rebounds have so far been capped by stiff selling pressures with 7810 becoming a fresh resistance. A fall below the recent low of 7690 would attract more bears and extend the correction to the round number of 7600. 7890 is the key resistance to clear to resume the uptrend.

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