Currency Pair Overview: Dollar Index Higher On Negative Equities

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Currency Pair Overview:

Dollar Index Higher On Negative Equities

Overall, declining S&P futures allowed the dollar index to gain some points, something not seen very often lately. Most of the moves came during the early U.S. trading hours, while the market was completely flat during the rest of the day. The worst performer in Tuesday trade was the Canadian dollar, after the BoC complained about its strength. Ahead, the report calendar is clear through the upcoming Asian and European trading hours. 

Dollar Index Technical View: TheLFB Member Charts.
Daily chart trend: Short. Main price points: 75.00. Looking for: Ending diagonal

Prices on the dollar index have reached new lows recently, which means that the final push of an ending diagonal is in progress. The market looks to be targeting the 75.00 support region, where an ending diagonal of a red wave V may be completed. If this is the case then traders should be looking for a long turning point, especially once the upper line of diagonal is taken out.

The euro (EUR/USD 1.4930) plunged 100 pips during U.S. trading hours, after an overnight session in which the pair concentrated in a 35-pip range. After declining 100 pips, the euro managed to find a bottom slightly below the 1.4900 area, where it met a support trend-line, which has held it higher for three weeks. This downtrend might allow the euro to test the 1.5000 area. 

The pound (GBP/USD 1.6360) traded up and down during the day, but still failed to move anywhere decisively. On the daily chart, the pound is trading slightly above the 100-day moving average, but below a resistance trend-line that has held the pair since early August. A break above this level will probably extend the uptrend seen over the last few days of trading.

Trade Plan of the Day: TheLFB Trade Plan is GBP/USD, one of the six that are available to members on the major pairs each day, plus four Jpy based cross pairs, plus S&P futures, oil, gold, and the dollar index.

The aussie (AUD/USD 0.9220) is currently trading down 80 pips, posting the biggest daily decline of the last three weeks of trade. On the daily chart, the aussie is trading at a considerable distance from the important moving averages, while it is getting closer to the deeply overbought area. 

The cad (USD/CAD 1.0500) was today’s worst performing pair, after the BoC complained about the strength the Canadian dollar posted lately. The cad surged 220 pips during the U.S. session, while it moved only flat throughout the overnight session. If the pair will extend the current uptrend, the next target is in the 1.6250 area. 

The swissy (USD/CHF 1.0120) saw a very thin momentum during the day, something that happens more and more often lately. Except for the spike that the pair made during the U.S. open, the swissy moved without a clear direction for the rest of the day. 

The yen (USD/JPY 90.60) is currently forming a doji-star candle on the daily chart, as the yen failed to develop and sustain a trend in Tuesday trade. On the daily chart, the yen is trading between the 20 and the 50-day moving averages, which might act as an important price points over the upcoming sessions.