USD Analysis & Setups

With the break of the 4 hourly support trend line (blue), the NZDUSD has certainly lost its uptrend momentum and it has been retracing quickly. Especially yesterday’s daily candle was very bearish and the daily has already been broken in today’s intra-day trading. How far can the retracement go?

There is a daily support level (magenta line) at 0.85, but otherwise a natural support level seems to be present around the 50% Fibonacci retracement. Besides the Fib, there is also broken resistance (green lines) that has the tendency to act as potential support in the future.

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Does the AUDUSD have a similar market structure as the Kiwi?

Yes it does. The AUDUSD certainly has a bullish 4 hour trend when looking at it higher highs and higher low (magenta trend line).

Here too price seems to be on a retracement tour after breaking the bottom of a consolidation. Here too the most natural support level occurs at the 50% Fibonacci retracement level because the broken tops will provide extra support for a bounce.

The target for the AUDUSD is the daily 61.8% Fibonacci retracement level.

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The Euro is losing ground against US Dollar as well. The Euro bulls had some hope after breaking out of the down trend channel yesterday (break of magenta and purple) but price failed to follow through and continue higher.

After breaking the triangle (blue), price seems now close to breaking a support trend line (light) blue. Be aware however of yesterday’s low at around 1.3750. A sustainable break could translate into downside extensions down till the next support level at the 61.8% Fib (orange).

Of course, be aware that the EUR has a bid rate decision, which will have a major impact on the potential movement.

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Last but not least, the USD strength is also apparent against the Yen as the daily resistance (magenta line) was broken at the beginning of this month. There have been other break outs of trend lines on this pair (orange lines) which have occurred with a neat uptrend channel (blue lines).

Notice that the USDJPY has been trending up nicely according to our DTT trend indicators as well. However, we need a retracement and bounce before the DTT trigger candle will appear. After a decent run up, the currency pair is certainly vulnerable for a bit of retracement. And in most cases this should happen sooner rather than later, although nothing in trading is 100%.

Currently there is already a 1 hour wick on the highest candle. That could signal the start of the anticipated retracement, although one more push up towards 104.15-20 can always occur.

The most likely bouncing spot for more upside continuation are the 23.6% and 38.2% Fibonacci retracement levels (magenta). But price could retrace as deep as the 50% which would be a hook back to the broken resistance trend line.

The first target for this upside is the -27.2% target at 104.70, which right below the next daily resistance at 104.80, although a trail stop loss is also valid.

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Last but least, be aware that tomorrow there are NFP and unemploment rate figures being released.

What do you think of the above currency pairs? Are you looking to enter on any of them? Let us know down below!

Thanks for sharing this article and wish you as always Happy Trading and many pips!

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