“But even Dollar bulls shouldn't mind a small correction at this point.” (#102)
Our initial impression was correct that the Dollar is trading too high. Since the last update, the Dollar-Index (DXY) is down about 2.5% from Wednesday’s high. That is a minor but solid correction. However, above the 110.75/110.25 support zone, the bullish DXY picture remains intact. Protagnists with Dollar shorts should mind the 113 resistance. Above that treshold, shorts are again very vulnerable.
(source: fxstreet.com)
EURUSD -- 0.9793
The Euro has had a nice comeback but is still trading in bearish territory. A whole series of resistances should block the way up for the time being:
0.9895 -- mid Bollinger band
0.9952 -- former support
1.0013 -- 50 ema
Together with the red descending trend line (1.0020 ish) the resistance zone is well defined and the trading plan should be clear. Get rid of shorts somewhere above 1.0051 at the latest.
GBPUSD -- 1.1124
Sterling shows FX can be very volatile again. Monday’s low of 1.0340 was crazy. Hats off to whoever bought it down there. Above the 1.1000 treshold the pound should be supported for the time being. In short-term there is still room on the upside up to 1.1307 (mid Bollinger band) and 1.1411 (covid low). In the medium term, the 50 ema resistance would have to be overcome.
Good luck,
Sebbo