USD regains momentum. FX Indices Review.

USDX

Monthly: The November candle is printing a bullish candle and is still sitting above the ‘resistance-now- turned support’ of the monthly chart’s bear triangle tend line. It has not managed to move above the resistance of the 2010 highs though.

USDXmonthly

Monthly Ichimoku: The November candle is still well above the monthly Cloud.

USDXmonthlyCloud

Weekly: Last week’s candle closed as a large bullish candle but still under resistance from the 2010 highs.  

USDXweekly

Weekly Ichimoku: Price is still trading ABOVE the weekly Cloud.

USDXweeklyCloud

Daily: Price spent most of the week consolidating in a Flag under the 2010 high region of 88.50. The index broke up and out of the Flag on Friday but closed below the 2010 highs.

USDXdaily

Daily Ichimoku Cloud chart: Price traded above the Cloud all week. Price is still above the daily Cloud and there is still an open bullish Tenkan/Kijun cross in play.

USDXdailyCloud

4hr: Price chopped sideways for much of last week within a Flag until Friday’s bullish breakout.

USDX4

4hr Ichimoku Cloud chart: Price chopped in and out of a narrowing Cloud band all week but Friday’s bullish day meant that it eventually closed above the Cloud. This chart is back to being aligned with the daily chart and suggests long USD.

USDX4hrCloud

EURX

Monthly: The November candle has pulled back somewhat and is now printing a bullish coloured ‘Inverted Hammer’ style candle. I am still seeing a larger-scale bullish ‘inverse H&S’ pattern developing though.

EURXmonthly

Monthly Ichimoku: The November candle is trading within the monthly Cloud.

EURXmonthlyCloud

Weekly: The weekly candle closed as a bearish coloured, essentially, ‘inside’ candle.

EURXweekly

Weekly Ichimoku: Price is still trading below the weekly Cloud.

EURXweeklyCloud

Daily: Price chopped higher last week but stalled at the resistance of the daily 200 EMA. The ECB announced more QE on Friday and this sent the index tumbling.

EURXdaily

Daily Ichimoku Cloud chart: Price had closed above the daily Cloud by the end of last week and this was the first close above the daily Cloud since May 5th, a period of over 6 months. Price pulled back on Monday though and tested the top of the Cloud but traded higher thereafter. Friday’s ECB QE activity sent the index back lower but it found some support from the top of the daily Cloud where it eventually closed for the week.

EURXdailyCloud

4 hr: Price chopped higher until Friday.

EURX4

4 hr Ichimoku Cloud chart: The EURX traded above the Cloud all week until Friday when QE news triggered a sell off and price fell back down to within the Cloud.  This chart is back to being divergent from the daily chart and suggests choppiness.

EURX4hrCloud

Comments:

USDX: the USDX had a bullish week but, although it is holding above the monthly triangle breakout it is still struggling at resistance from the previous 2010 highs near 88.50. This will be the level to watch next week and any bullish break of this would put 89.50 as next on the radar. I noted in a separate article during the week about the 90 level of the USDX is significant long term resistance and will be a force to be reckoned with even if there is bullish continuation through the 2010 and 2009 highs.

The index has been on a lengthy bullish run and some pull back, even if only temporary, would not be out of order. Obvious pull back targets include the previously broken monthly trend line and then the 83 region which is near the daily 200 EMA and the 61.8% fib of the recent bull run.

EURX: the EURX was having a good week until Friday. The index had chopped higher despite some mixed EZ data but Friday’s ECB QE news undermined this progress, and then some! Divergence between the Eurozone and US economies continues to be a dominant theme and the overall progress of the indices is reflecting this. Even with this latest fall the index has managed to hold above the broken trend line and the daily Cloud to see out the week. These will be the levels to watch next week and any continuation back below these levels would be bearish. I still have my eye on the bullish ‘inverse H&S’ building on the monthly chart though!

Note: The analysis provided above is based purely on technical analysis of the current chart set ups. As always, Fundamental-style events, by way of any Ukraine, Ebola, Eurozone or Middle East events and/or news announcements, continue to be unpredictable triggers for price movement on the indices.  These events always have the potential to undermine any technical analysis.