The following are the intraday outlooks for USD Index, EUR/USD, EUR/JPY, and Spot Gold as provided by the technical strategy team at SEB Group.
USD INDEX: Topside struggle. The dollar index also a second consecutive day continued to show signs of exhaustion (false break and top side spike) and given that we also have a bearish divergence in place some caution is clearly urged. A move below 91.51 will further enhance a correction warning.
EUR/USD: Seeking a mid body test. The pair initially extended the decline down to 1.1459 before rebounding back to close at the previous day’s low point. Given the preceding day’s (and also last week’s) falling benchmark candle there’s historically a tendency for the market to try the mid body point, 1.1703/10 (weekly and daily mid body points) within two to three periods after the benchmark candle was printed.
EUR/JPY: Targeting next 134.15 (key support). Since the recent low point, 134.70, the cross has risen in an hourly three wave corrective pattern hence keeping the downside pressure intact. We see a clear possibility that the minor reaction terminated at 136.19 and that we now are on the verge of falling down (confirmed below 134.85) to the 134.15 key support (the barrier to a continued decline into the 120’s).
Spot Gold: Best single week gain since Aug’13. Gold had its best single week since mid Aug 2013 and this count for something. Price action remains notably bullish and is defying near- & short-term stretches. Dips should be bought into as refs at 1,289 & 1,296/99 should be targeted next (as there are objectives still to fill even higher up at 1,322/25 and at 1,341/45 later. Strong support pockets are located at 1,271 and at 1,255/46.
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