Four FX charts worth watching in coming sessions

Four FX charts worth watching in coming sessions

Forex 4 minutes to read
John J. Hardy

Global Head of Macro Strategy

Summary:  The US dollar has been doing all it can to avoid throwing off any impression that it is ready to make a directional move recently, but cannot avoid making a statement over the coming two weeks as important levels are bound to come into view and incoming data the week after next will inevitably spark volatility. Elsewhere, SEK is trying once again to get interesting in mounting a charge higher and a key support is coming into view in AUDNZD.


FX volatility continues to fall, with a new record low near 5.0% for the EURUSD 6-month volatility posted today. But the pair will inevitably bump up against important levels one way or another and is looking heavy into the close of trading this week. Will we suffer another week of uncertainty on the dollar in this low volatility environment next week, which is a US holiday week (most off work Thu-Fri) as we await the key ISM survey data and November jobs report the following week, or does the dam break already next week on USD developments – tough to say but we’re not far from levels that will require decisions to be made and trigger stop-based flows.

EURUSD – heavy but lacking momentum
Recently, EURUSD found support around the important 1.1000 level we highlighted in our prior Tech chart post, but the subsequent impulse has proven rather weak and we have yet to take out the recent cycle highs, and in fact the momentum is pushing back lower, with the tactical 1.1050 area facing an attack today as we continue to eye that very important 1.1000 level. Another attack on the 1.1000 area pivot level might take the pair toward the cycle lows and even beyond as the descending channel formation of the last 15+ months continues to dominate until this pair blasts at least through 1.1200.

Source: Saxo Group

AUDUSD – heavy again despite strong risk appetite
AUDUSD is in a similar situation to EURUSD and another pair for checking in on the USD status in coming sessions. One of the remarkable things about the AUD recently is its lack of correlation with general risk conditions, perhaps as the RBA is in the midst of an easing cycle and on concerns that the US-China trade relationship is not going anywhere fast. A close below the local pivot could set up a charge for the sub-0.6700 lows again, though we ‘ve not yet seen a close below that level for the cycle – and those lows are the lows for the past decade since the global financial crisis.

Source: Saxo Group

AUDNZD - 200-day moving average is here
Speaking of AUD, a look at AUDNZD shows that pair testing the 200-day moving average after the RBNZ failed recently to cut rates. Bulls here need to tread carefully may want to position lightly until better signs emerge of technical support coming in - whether here or around 1.0500 (close to the last important Fibonacci level).

Source: Saxo Group

EURSEK – dare we say, here we go again, again?
The EURSEK range is so well established that another challenge of the lows here certainly worth paying attention to as the Riksbank is likely headed for a December rate hike – that’s right, hike. EURNOK showed us last week the frequent danger of signals that unfold on a Friday, so we’ll need a status check on this attempted break below the 10.61 area on Monday for whether the undervalued SEK can finally develop some momentum and work its way out of this range versus the EUR. Note that the spike below 10.60 in yesterday’s session is a mis-feed (actual low was above 10.64), and a close today near current levels would be the lowest daily close in over three months.

Source: Saxo Group

Quarterly Outlook

01 /

  • Equity outlook: The high cost of global fragmentation for US portfolios

    Quarterly Outlook

    Equity outlook: The high cost of global fragmentation for US portfolios

    Charu Chanana

    Chief Investment Strategist

  • Commodity Outlook: Commodities rally despite global uncertainty

    Quarterly Outlook

    Commodity Outlook: Commodities rally despite global uncertainty

    Ole Hansen

    Head of Commodity Strategy

  • Upending the global order at blinding speed

    Quarterly Outlook

    Upending the global order at blinding speed

    John J. Hardy

    Global Head of Macro Strategy

    We are witnessing a once-in-a-lifetime shredding of the global order. As the new order takes shape, ...
  • Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Quarterly Outlook

    Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Jacob Falkencrone

    Global Head of Investment Strategy

  • Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    Quarterly Outlook

    Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    John J. Hardy

    Global Head of Macro Strategy

  • Equity Outlook: The ride just got rougher

    Quarterly Outlook

    Equity Outlook: The ride just got rougher

    Charu Chanana

    Chief Investment Strategist

  • China Outlook: The choice between retaliation or de-escalation

    Quarterly Outlook

    China Outlook: The choice between retaliation or de-escalation

    Charu Chanana

    Chief Investment Strategist

  • Commodity Outlook: A bumpy road ahead calls for diversification

    Quarterly Outlook

    Commodity Outlook: A bumpy road ahead calls for diversification

    Ole Hansen

    Head of Commodity Strategy

  • FX outlook: Tariffs drive USD strength, until...?

    Quarterly Outlook

    FX outlook: Tariffs drive USD strength, until...?

    John J. Hardy

    Global Head of Macro Strategy

  • Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Quarterly Outlook

    Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Althea Spinozzi

    Head of Fixed Income Strategy

None of the information provided on this website constitutes an offer, solicitation, or endorsement to buy or sell any financial instrument, nor is it financial, investment, or trading advice. Saxo Capital Markets UK Ltd. (Saxo) and the Saxo Bank Group provides execution-only services, with all trades and investments based on self-directed decisions. Analysis, research, and educational content is for informational purposes only and should not be considered advice nor a recommendation. Access and use of this website is subject to: (i) the Terms of Use; (ii) the full Disclaimer; (iii) the Risk Warning; and (iv) any other notice or terms applying to Saxo’s news and research.

Saxo’s content may reflect the personal views of the author, which are subject to change without notice. Mentions of specific financial products are for illustrative purposes only and may serve to clarify financial literacy topics. Content classified as investment research is marketing material and does not meet legal requirements for independent research.

Before making any investment decisions, you should assess your own financial situation, needs, and objectives, and consider seeking independent professional advice. Saxo does not guarantee the accuracy or completeness of any information provided and assumes no liability for any errors, omissions, losses, or damages resulting from the use of this information.

Please refer to our full disclaimer for more details.

Saxo
40 Bank Street, 26th floor
E14 5DA
London
United Kingdom

Contact Saxo

Select region

United Kingdom
United Kingdom

Trade Responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more
Additional Key Information Documents are available in our trading platform.

Saxo is a registered Trading Name of Saxo Capital Markets UK Ltd (‘Saxo’). Saxo is authorised and regulated by the Financial Conduct Authority, Firm Reference Number 551422. Registered address: 26th Floor, 40 Bank Street, Canary Wharf, London E14 5DA. Company number 7413871. Registered in England & Wales.

This website, including the information and materials contained in it, are not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in the United States, Belgium or any other jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation.

It is important that you understand that with investments, your capital is at risk. Past performance is not a guide to future performance. It is your responsibility to ensure that you make an informed decision about whether or not to invest with us. If you are still unsure if investing is right for you, please seek independent advice. Saxo assumes no liability for any loss sustained from trading in accordance with a recommendation.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. Android is a trademark of Google Inc.

©   since 1992