USDX (USD Index)
The downturn of the U.S dollar index brought the index to test 96.10 support level. There is a strong bullish reaction from the level and printed a bullish engulfing pattern yesterday. It is up to the bull now whether to close above the pattern to confirm bullish breakout or continue moving sideways and close below 96.10.
Meanwhile, there is a surge in Yen today as the market warned by Apple sink in revenue. The situation might trigger risk-averse situation which helps boost U.S dollar index.
News to watch
For full outlook for this week, you can follow Forex Outlook For The Week 31 December – 4 January 2019
Technical Analysis
EUR/USD
EUR/USD punched down by the bear yesterday after it tested 1.1500. The pair setback below the trendline and 1.1360. Fortunately, there is no breakout below 1.1300. If the bull could bring the pair back above 1.1360 and the trendline then EUR/USD might resume its uptrend to rechallenge 1.1500.
Today critical level to watch:
Support: 1.1300
Resistance: 1.1360, 1.1500, 1.1580
GBP/USD
Another sell-off happen in GBP/USD as risk-aversion enter the market. The selling of GBP/USD creates another fresh low which suggests the bear still hold the advantage and could push the pair further lower. Currently, traders could watch 1.2625 as the level to take short positions.
Today Critical level to watch:
Support: 1.2500
Resistance: 1.2625, 1.2800
USD/JPY
USD/JPY pummeled by the bear and drop from a level near 109.00 to as low as 104.87 before making recovery. It is traded near 107.40 which might become the equilibrium level. The pair might move wildly at current level but we expect more bullish recovery which could extend toward 109.00.
Today critical level to watch:
Support: 105.00
Resistance: 107.40, 109.00
AUD/USD
Similar to USD/JPY, the pair experience sharp sell-off in Asian session after Apple announce huge miss in revenue. However, the bull slowly recovered most of the losses and AUD/USD currently getting near its opening level. We might have false sell-off which could turn into buying in a few days.
Today critical level to watch:
Support: 0.7000
Resistance: 0.7160, 0.7200, 0.7300