USD INDEX: Soon through the 55d ma band. During the past six months the market has been digesting the break above of the 1985 Plaza accord trend line. The consolidation is of course a bullish one given that it was entered from beneath (and in a very strongly trending way). With higher and higher lows (and rejections from the yearly average) together with more frequent attempts to return above the 55d ma band an upside break is now becoming increasingly likely. Breaking above 96.62 will be the next indication for the next bull run to have started.
EUR/USD: A completed upside correction. Prices went slightly higher than the anticipated maximum of 1.1266 before finishing the correction and turning back to a downside focus. Early offers should today be found already in the 1.1190-area so we expect prices to soon continue lower and to challenge the low 1.11’s early next week.
USD/CAD: Notable selling at long-term target. A long-term 1.3414 Fibo was yesterday taken out with a mere 3pips and then notably fierce responsive selling kicked in to push it into a low and possibly near-term bearish close. If not staging a better assault at the +1.34s soon, losses leading back towards dynamic support, now at 1.3215- 1.3135, could easily unfold. Current intraday stretches are located at 1.3235 & 1.3435.
EUR/GBP: Exited the bull flag. As pointed at yesterday sterling weakness is visible across the board and another piece of evidence was posted yesterday with EUR/GBP exiting its month-long bull flag. The setback from yesterday’s high should find support around the former flag ceiling from where a new round of buying is seen emerging. On a slightly longer time horizon it is not unlikely that we will revisit the 0.77/78 area.
For the latest trades & forecasts from major banks, sign-up to eFXplus