The USD has been on a long term downtrend against the CHF and has established a descending channel as seen on the monthly chart. As you can see on the chart, the USD has tested the bottom white trend line of the channel. So far, the channel has held as support, and the momentum indicators are signalling a rise up to test the yellow 5 sma close. All 4 moms are in agreement pointing up, with the blue one candle mom breaking above her 100 level. When this occurs, it signals a 5 sma retrace, as denoted by the top of candle wick touching the yellow 5 sma. A 5 sma retrace is a pullback in price to the level where the average closing price of the last 5 candles resides. This price level is usually a good bet to get short on the continuation of a strong trend. A break out above this level will signify that a bottom is in place, and the price may surge up on stop losses to test the middle of the channel area which is defended by the cluster resistance of the green 22 sma and the blue 14 sma. A break above there would test the upper end of the channel around the white descending trendline.
The USD began to strengthen against the Euro in November, then went into a large consolidation in December and January. There is an annual pattern of USD strength from the Thanksgiving/Xmas season until Easter/Memorial Day. When Things looked all Doom and Gloom for the USD it rallied last fall, and things were Doom and Gloom for the Euro. Now the Euro has bounced back, and so will the USD.
Look for eur/usd to pull back from these current prices to long term support price levels.
Aud/usd may pull back to a good buying opportunity if the USD makes a run.
The USD began to strengthen against the Euro in November, then went into a large consolidation in December and January. There is an annual pattern of USD strength from the Thanksgiving/Xmas season until Easter/Memorial Day. When Things looked all Doom and Gloom for the USD it rallied last fall, and things were Doom and Gloom for the Euro. Now the Euro has bounced back, and so will the USD.
Look for eur/usd to pull back from these current prices to long term support price levels.
Aud/usd may pull back to a good buying opportunity if the USD makes a run.
Attached Image(s) (click to enlarge)
