Monday, 22 July 2019 09:05 GMT
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Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts & More




(MENAFN - DailyFX) The U.S. Dollar Index (DXY) broke through a confluence of support, triggering a sizable wedge pattern; this sets it up for lower prices over the intermediate-term. Bounces will develop at times, though, and these may give would-be shorts an opportunity to enter bearish wagers. TheEuroat resistance, could pull back to support soon.USDCADlooks to be in trouble on the weekly time-frame, near-term resistance could soon get hit.GBPUSDweakness could lead to development of bottoming price pattern.

Technical Highlights:Dollar Index (DXY) counter-trend bounce could developEURUSDpullback to support may provide spot for longs USDCAD headed lower big-picture, watch resistance GBPUSD pullback will help further a bottoming pattern

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Dollar Index (DXY) counter-trend bounce could develop

Last week, the US Dollar Index (DXY) closed a weekly candlestick outside of a rising wedge pattern and below confluent support that involved the bottom of the formation and the 200-day MA. This setsUSDup for lower prices, but there will be bounces along the way.

Right now, support from March is in play. A bounce from there could offer up an opportunity for would-be shorts to enter for a move to the next set up of support levels carved out in January in the vicinity of 95.16/03.

US Dollar Index (DXY) Weekly Chart (broke wedge formation)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More US Dollar Index (DXY) Daily Chart (trying to bounce from support)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More EURUSD pullback to support may provide spot for longs

In reverse of theDXY ,the Euro broke a falling wedge formation . EURUSD is currently challenging levels from March; a pullback from around here will have the June 7 high and 200-day combo in focus right around 11350. Below there a retest of the January trend-line might take shape. As long as the rally doesn't turn into a swift down-move as other rallies have since last year, then the Euro may be set up soon to keep on extending the wedge-break.

EURUSD Daily Chart (watch pullback to support)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More USDCAD headed lower big-picture, watch resistance

USDCAD is showing little to no life at this juncture after breaking down out of a longer-term channel structure. It looks poised to do as it did a couple of years ago. In the event of strength, watch the 13238 up to 13300 area for signs of stalling upward momentum. Overall, rallies and/or consolidations look set to turn into new swing-lows for the foreseeable future.

USDUSD Weekly Chart (looks like a repeat of 2017)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More USDCAD Daily Chart (weak bounce, resistance ahead)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More GBPUSD pullback will help further a bottoming pattern

Cable traded around the October 2016 trend-line for a couple of weeks, and on a daily basis depending on how it was drawn, it broke through at one point. With last week's bounce and close on a weekly basis above the trend-line, I moved it to beneath the weekly low while still allowing it to maintain its integrity in connecting lows from October 2016, early 2017, very near the January flash-crash low, and the low from a week ago today.

This will be the long-term line-in-the-sand I will work with. A pullback from here could, could set up an inverse head-and-shoulders (H & S) pattern. This is only a scenario but may be a worthy one given long-term support and the generally poor posturing of the Dollar against other currencies. For now, in 'wait-and-see' mode until further price action confirms outlined scenario.

GBPUSD Daily Chart (inverse H & S > long-term t-line?)Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts  & amp; More Resources for Forex & CFD Traders

Whether you are a new or an experienced trader, DailyFX has several resources available to help you; indicator for trackingtrader sentiment , quarterlytrading forecasts , analytical and educationalwebinarsheld daily,trading guidesto help you improve trading performance, and one specifically for those who arenew to forex .

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at@PaulRobinsonFX

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Dollar May Bounce: EURUSD, USDCAD, GBPUSD Charts & More

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