Technical Update - Correction time in EURUSD, GBPUSD and the Dollar Index? Technical Update - Correction time in EURUSD, GBPUSD and the Dollar Index? Technical Update - Correction time in EURUSD, GBPUSD and the Dollar Index?

Technical Update - Correction time in EURUSD, GBPUSD and the Dollar Index?

Forex 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank Group

Summary:  Indications of correction time in EURUSD, GBPUSD and Dollar Index
EURUSD rejected at strong resistance and 0.618 retracement
GBPUSD uptrend seems to be stalling with weakening Strenght Indicator
Dollar Index bouncing off 103 support and back above 200 Moving Average


EURUSD is has been rejected at the 0.618 Fibonacci retracement at 1.0960 to close below resistance at 1.0945

A correction could be unfolding possibly down to the 0.382 retracement at 1.0677. However, the 200 and 100 DMA’s just above that level will offer support.

RSI is showing positive sentiment with no divergence indicating EURUSD is likely to resume uptrend after a likely correction

If EURUSD is breaking above yesterday’s peak at 1.0965 EURUSD is likely to continue its bullish trend to the 0.786 retracement at 1.0986

Source all charts and data: Saxo Group

Dollar Index is bouncing from support at around 103. Question is whether the Index can get back above 104.45 thereby demolishing the bearish trend. If closing above 104.45 we could see further upside to 105.50-106. The declining 55 DMA will provide resistance however.
A close below 103 is likely to send the Dollar Index to the 0.618 retracement at 102.21

The RSI is currently below the 40 threshold i.e., showing negative sentiment with no divergence indicating lower levels are likely. However, if RSI is closing back above 40 and above its upper falling trendline the Dollar Index is likely to reverse its bearish trend

GBPUSD seems to being rejected at the resistance at around 1.2546. With RSI divergence there is indication of a correction.

But if GBPUSD does close above yesterdays’ peak at 1.2560 that divergence is likely to be cancelled paving the way for GBPUSD to move higher towards the 0.618 retracement at 1.2720

Trend is still bullish, however, and will remain bullish until a close below 1.2370.

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