Yahoo Finanza Dollar Sulks Ahead of FOMC Meeting
The mighty Dollar is weakening against every single G10 currency ahead of the Federal Reserve’s monetary policy announcement.
Dollar Index (DXY), which tracks the value of the greenback against major has tumbled to levels not seen three months below 96.30. With prices trading below the 20 Simple Moving Average and the Moving Average Convergence Divergence crossing to the downside, the DXY remains in a downtrend on the daily charts. The technicals are bearish and a solid daily close below 96.25 may inspire a decline towards 95.00. Should 96.25 prove to be reliable support, prices may rebound back towards 97.15 and 97.80.
Euro takes advantage as Dollar softens
Earlier in the week, we discussed the possibility of Euro bulls running on empty and running on fumes.
Economic data from Europe, especially Germany continues to paint a gloomy picture while questions linger over the effectiveness of monetary and fiscal tools against the coronavirus menace. Over the past few days, a vulnerable Dollar has offered the Euro support, but for how long?
Focusing on the technical picture, the EURUSD remains bullish on the daily charts thanks to Dollar weakness. The currency pair is trading above the 20 Simple Moving Average while the MACD trades to the upside. A solid breakout above 1.1360 may open a clean path towards 1.1450. Should 1.1280 prove to be unreliable support, the EURUSD may sink back towards 1.1200 and 1.1150 respectively.
USDJPY greedily eyes 107.00
The bearish setup we discussed on the USDJPY yesterday materialized with prices trading towards the 107.00 level.
It is becoming clear that the Japanese Yen remains in bid despite the “risk-on” sentiment with global growth fears and trade tensions stimulating appetite for safe-haven assets. A weakening Dollar is also playing a role in the USDJPY’s descent. The downside is building momentum with a breakdown below 107.00 opening a path towards 105.90.
USDCAD sinks deeper into the abyss
This currency pair is under intense pressure on the daily charts. There have been consistently lower lows and lower highs while the MACD trades to the downside. Sustained weakness below 1.3500 may encourage a decline towards 1.3300.
EURGBP breakout in play
A picture is worth a thousand words.
The EURGBP is slowly approaching the 0.8850 support level. A breakdown below this point may invite a decline towards 0.8700 which is 150 pips away. If 0.8850 proves to be reliable support, prices may rebound back towards 0.9000.
Commodity spotlight – Gold
Where Gold concludes this week will be heavily influenced by the Federal Reserve meeting and Dollar’s valuation.
Intraday bulls may have a chance to push the metal higher if an hourly close above $1720 is achieved today. A breakout above this point could inspire a move towards $1747.
If $1720 proves too much for buyers to handle, prices retrace back to $1670.
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This article was originally posted on FX Empire
