EUR/USD Rate Negates Risk for Double-Top Ahead of More ECB Rhetoric

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EUR/USD Rate Negates Risk for Double-Top Ahead of More ECB Rhetoric.

AUD/USD Outlook Mired by RSI Divergence; Australia Employment in Focus.

DailyFX TableEUR/USD

EUR/USD extends a allege from progressing this week amid a German Coalition Breakthrough, with a span during risk of entertainment a some-more suggestive convene as it wards off a risk for a double-top.

Recent cost movement suggests a Euro will continue to outperform opposite a U.S. reflection as a sell rate finally breaks above theSeptember-high (1.2092), and EUR/USD might continue to vaunt a bullish function over a near-term as both cost and a Relative Strength Index (RSI) extend a ceiling trends carried over from late final year.

Looking ahead, European Central Bank (ECB) house members Ewald Nowotny, Jens Weidmann and Benoit Coeure are slated to pronounce over a entrance days, and a collection of upbeat comments might continue to worsen a seductiveness of a single-currency as a Governing Council appears to be on lane to interpretation a easing-cycle in 2018.

The ECB might boost a efforts to ready European households and businesses for a reduction accommodative process position as ‘recent indicators forked to a continued strong and increasingly self-sustaining mercantile expansion,’ and a change in a financial process opinion might continue to fuel a allege from a November-low (1.15545) generally as a bull-flag arrangement appears to be panning out.

EUR/USD Daily Chart

EUR/USD Daily Chart

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  • Topside targets are behind on a radar for EUR/USD as it sentinel off a risk for a double-top, with a tighten above a 1.2130 (50% retracement) jump lifting a risk for a pierce towards 1.2230 (50% retracement).
  • Next segment of seductiveness comes in around 1.2320 (23.6% retracement) to 1.2370 (61.8% expansion), yet a RSI warrants courtesy as it comes adult opposite overbought territory; need a oscillator to pull above 70 to yield conviction/confirmation for a serve allege in a sell rate.


AUD/USD struggles to reason a belligerent following an astonishing uptick in a core U.S. Consumer Price Index (CPI), with a near-term opinion dark with churned signals as a pivotal movement indicator appears to be devious with price.

Even yet AUD/USD climbs to uninformed 2018-highs during a initial full-week of January, a Relative Strength Index (RSI) fails to vaunt a identical dynamic, with a oscillator on a fork of descending behind from overbought territory. A flourishing dissimilarity between cost and a RSI raises a risk for a near-term pullback, yet uninformed information prints entrance out of Australia might keep a aussie-dollar sell rate afloat as a economy is approaching to supplement another 15.0K jobs following a 61.6K enlargement in November.

Keep in mind, a imitation might do small to change a financial process opinion as a Reserve Bank of Australia (RBA) stays in no rush to mislay a record-low money rate, yet signs of stronger-than-expected enlargement might inspire Governor Philip Lowe and Co. to strike an softened tinge during a initial 2018 assembly on Feb 6 as ‘spare ability in a work marketplace was approaching to be engrossed gradually and salary enlargement was approaching to collect adult over time.’ In turn, a near-term resilience in AUD/USD might insist as a RSI clings to overbought territory, with a topside targets still on a radar as a span carves a uninformed array of aloft highs lows. For additional resources, download and examination a

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AUD/USD Daily Chart

AUD/USD Daily Chart

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  • Broader opinion for AUD/USD has perked adult as cost a RSI mangle out of a bearish formations carried over from a summer months, with a 0.7930 (50% retracement) to 0.7940 (61.8% retracement) jump on a radar as a span clears a October-high (0.7898).
  • Next topside segment of seductiveness entrance in around 0.8030 (38.2% expansion) followed by a 2017-high (0.8125), yet a near-term resilience in a aussie-dollar sell rate might uncover if a RSI struggles to reason above 70 and flashes a text sell signals.

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— Written by David Song, Currency Analyst

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