FX Breakout Monitor: EUR wilts as USD pokes higher still FX Breakout Monitor: EUR wilts as USD pokes higher still FX Breakout Monitor: EUR wilts as USD pokes higher still

FX Breakout Monitor: EUR wilts as USD pokes higher still

Forex 3 minutes to read
John Hardy

Head of FX Strategy

Summary:  The euro weakness is taking it to new lows in a few crosses, including in EURUSD and EURJPY, even if volatility is a bit sluggish, to say the least. Elsewhere, the US dollar is poking close to or beyond breakout levels as it recently avoided a larger scale breakdown that seemed to threaten, keeping momentum traders guessing.

The link below takes you to the latest FX Breakout Monitor, a concise PDF overview of all current and recent price breakouts for the short and medium term for major FX pairs and spot silver and gold.

Today’s Breakout monitor

The euro weakness of late stands out as a prominent development, though it has been a bit of a slow affair and implied volatility in the options for EURUSD is nearing all-time record low levels for all tenors. The euro is also on the verge of new local breakouts to the downside versus the JPY and CHF, with the former a bit more interesting on recent surprise volatility in the Japanese government bond market, where yields have spiked higher recently. EURGBP has also had a go at new local lows as Nigel Farage’s Brexit moved away from directly challenging the Tories in the December election by announcing Brexit party candidates would not run in clear Tory districts.

US President Trump is out speaking not long after we are posting this and could jar the market with comments, for better or worse, on the US-China trade deal negotiations. US Fed Chair Powell is set to speak tomorrow, so we could have the makings for a bit more volatility picking up, especially as the US dollar rally after the recent sell-off is nearing the tilting point for a larger move if it persists.

The global bond sell-off has cast a cloud over precious metals, where breakouts lower unfolded late last week and are two of the few breakouts to extend into profitable territory for a time in this generally choppy market for momentum traders.

Today’s Breakout Highlight: EURUSD
EURUSD is poking to new lows starting with Friday’s new 19-day low close, the first short-term breakout to the downside since. Arguably, as the move goes against the previous large rally wave, the bears have more to prove, but a failure of the 1.1000 level and therewith a round number and the 61.8% Fibo area, could set the pair on a course to a full test of the sub-1.0900 lows – a surprising more than 2 ATR away from current levels, due to very compressed trading ranges of late.

Source: Saxo Group

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000

Contact Saxo

Select region


The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.