Weekly Technical Perspective on DXY, GBP/USD and NZD/USD

In this array we scale-back and take a demeanour during a broader technical design to benefit a bit some-more viewpoint on where we are in trend. Here are a pivotal levels that matter on a weekly charts for a DXY, GBPUSD and NZDUSD forward of this week’s FOMC, BoE and RBNZ seductiveness rate decisions. Review this week’s Strategy Webinar for an in-depth relapse of these setups and more.

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DXY Weekly Price Chart

DXY Price Chart - Weekly Timeframe

Notes: We’ve been tracking this cost analog in a U.S. Dollar Index given final year and streamer into a Federal Reserve seductiveness rate preference on Wednesday, a risk stays reduce while next a 2017 low-week tighten during 91.33 (bearish invalidation). Interim support rests with a 2010 high during 88.71 corroborated closely by connection support during 88.18 where a 50% retracement of a 2011 allege converges on basic slope support.

Bottom Line: The concentration stays on a mangle of a 88.18 – 91.33 cost range. A downside mangle would expected fuel accelerated waste towards a 2011 trendline support around ~86.75 while a topside crack would advise that a some-more poignant low is in place.

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GBP/USD Weekly Price Chart

GBP/USD Price Chart - Weekly Timeframe

Notes: The British Pound has been trade within a proportions of this ascending pitchfork formationextending off a 2016 / 2017 lows with prices branch only forward of a top median-line together early in a year. Price pennyless by a monthly opening-range final week and leaves a risk aloft streamer into a tighten of a month. That said, cost is now entrance a median-line and a daily tighten above this threshold would be indispensable to keep a evident allege viable.

Bottom line: The broader concentration in Sterling stays weighted to a topside while above a reduce median-line together / 2016 high-week tighten (Brexit) during 1.3675 (keep an eye on a RSI support trigger). A crack / tighten above a 2018 high-day tighten during 1.4134 would keep a long-bias in play targeting a 200-week relocating normal during ~1.4280s and a yearly high during 1.4346.

GBP/USD IG Client Positioning

GBP/USD IG Client Sentiment

  • A outline of IG Client Sentiment shows traders are net-short GBPUSD- a ratio stands during -1.16 (46.3% of traders are long) – diseased bullishreading
  • Long positions are 6.0% aloft than yesterday and 1.5% reduce from final week
  • Short positions are 4.5% aloft than yesterday and 9.1% aloft from final week
  • We typically take a contrarian perspective to throng sentiment, and a fact traders are net-short suggests GBPUSD prices might continue to rise. However, retail is reduction net-short than yesterday though some-more net-short from final week and the multiple of stream positioning and new changes gives us a serve churned GBPUSD trade bias from a view standpoint.

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NZD/USD Weekly Price Chart

NZD/USD Price Chart - Weekly Timeframe

Notes: The New Zealand Dollar has continued to connect next a Jan highs during 7436 with a 200-week relocating normal throwing a closes on a downside over a past few months. I’m looking for a fortitude to this pivotal cost operation over a entrance weeks with pivotal support (bullish invalidation) eyed during 7094-7140 where a 52-week relocating average, 50% retracement, and a yearly open intersect on simple slope support.

Bottom line: Kiwi stays in a well-defined operation streamer into a RBNZ seductiveness rate preference after this week. Price might see some upside as we proceed a operation lows (note we incited currently nearby monthly-open support during 7208) though ultimately, we’ll be looking for a dermatitis of this section for near-term guidance. Note that near-term cost movement highlights a probable 5-wave decrease off a monthly highs, suggesting that a liberation during these levels should infer improvement and keeps a broader concentration weighted to a downside for now.

Previous Weekly Technical Perspectives

— Written by Michael Boutros, Technical Currency Strategist with DailyFX

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