USD Index
As per weekly report, there is an expectation that the USD index would move back towards the November 50% level at the start of this week.
There is also a breakout of the October and 3rd quarter lows, therefore there’s an expectation that the trend is moving lower, after testing the November 50% level and also the 3-week highs.
This could happen later this week:- Thursday or Friday, but it might also happen next week, as long as Friday closes below those levels.
Whilst currencies come under pressure until then, and a few are showing signs of further weakness…
The euro has continued to come under pressure and a breakout of the 5-day lows on Tuesday isn’t a good sign in the short-term, as the market can often continue down for the rest of the week.
The only saving grace is the 3-week lows at the moment, and whether Wednesday’s 5-day lows will support the euro @ 1.3663
As we can see there are a number of higher timeframe support levels that are critical this week, which means if it is trading below the 3-week lows and 1.3656 the trend is going much lower.
The only way to verify support is this week’s close (Friday remains above those levels) and the USD fails around the 3-week highs this week.
AUD Weekly and 5-day pattern
AUD reverses down from a higher weekly open and moves back into retesting last week’s breakout @ 1.0006
We have two patterns in the AUD to keep an eye on….
#1 finds support around Wednesday’s daily low (5-day low) and swings upwards
#2 November highs completes the 2nd month wave pattern during the 4th Quarter (October & November) and then AUD moves into a consolidation pattern within the Weekly ranges until next month
Today:-
At this stage the 5-day 50% level is seen as resistance during the first 12 hours.
Support:- Wednesday’s lows @ 9970 to 9983
