USDX (USD Index)
U.S dollar index is losing value sharply in two days and broke 92.00 support. The breakout below the support level might have sealed the medium-term trend. Now, it will challenge 2017 low which is the critical level for bearish continuation. Traders who are long in U.S dollar might want to cover position or deleverage.
News to watch
08.30 AM U.S CPI estimate 0.1% increase MoM, core CPI estimate increase 0.2% MoM
Core Retail Sales forecast increase 0.3% MoM, Retail Sales up 0.5% MoM.
For full outlook for this week, you can follow Forex Outlook For The Week 8 – 12 Jan 2018
Technical Analysis
EUR/USD
Euro bull is charging across the board after ECB hawkish comment and German reach a preliminary deal to form a new government. Despite the bullish news, the bull needs to break above the top of the bullish channel to continue upside. If the bear return to the market, we might see some reaction from the top of channel today.
Today critical level to watch:
Support: 1.2100, 1.2070, 1.2000, 1.1925
Resistance: –
GBP/USD
The weakness of U.S dollar index also cheered in GBP/USD as the bull claimed level above 1.3600. It is one of the post-Brexit levels which hold the bull from moving higher in 2017. Currently, the pair ready to test 2017 high at 1.3655. A breakout above the resistance will lead GBP/USD toward 1.3835.
Today critical level to watch:
Support: 1.3600, 1.3500, 1.3450, 1.3400, 1.3342
Resistance: 1.3655
USD/JPY
The downward movement of USD/JPY contained at 111.00 where it bounced previously. The bearish momentum is strong, but the bull has not given up yet. Will the pair bounced from the support level or break below it?
Today critical level to watch:
Support: 111.00, 110.50
Resistance: 111.60, 112.00, 112.50, 113.20, 114.50
AUD/USD
AUD/USD gained the bullish advantage after the pair closed above 0.7875 on the previous trading day. The pair is currently testing the broken resistance. Traders will watch where the pair closed at the end of the week to determine if the break is valid.
Today critical level to watch:
Support: 0.7875, 0.7800, 0.7750, 0.7690
Resistance: 0.7970