Technical Update - EURUSD taking out key resistance looking at 1.11 and higher. Dollar Index could drop below 100 Technical Update - EURUSD taking out key resistance looking at 1.11 and higher. Dollar Index could drop below 100 Technical Update - EURUSD taking out key resistance looking at 1.11 and higher. Dollar Index could drop below 100

Technical Update - EURUSD taking out key resistance looking at 1.11 and higher. Dollar Index could drop below 100

Forex 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  EURUSD has taken out key resistance and is set for 1.1170. Medium-term EURUSD could move above 1.14
Dollar Index close to test key support at 101.30. If broken a sell-off down to around 98 is in the cards. Indicators support the bearish scenario


EURUSD closed last week above key resistance at 1.08 and is set for higher levels. RSI is still showing divergence but has broken above its falling trendline indicating it could trade out the divergence i.e., a new high on RSI is in the cards.
There is no strong resistance on EURUSD until around 1.1170. 100 and 200 weekly SMA’s are coming down providing some resistance around 1.11-1.12. If EURUSD reaches that area, which seems quite likely, a larger correction should be expected.
However, EURUSD could spike up to strong resistance at around 1.1482. That level is the peak just before the massive sell-off really hit EURUSD back in 2022.
Weekly RSI is above 60 i.e., showing positive sentiment an d no divergence supporting the bullish outlook.

For EURUSD to reverse the bullish picture a close below 1.0480 is needed.

Source all charts and data: Saxo Group

The Dollar index took out support at around 103.20 and could be testing 101.30 shortly. There is divergence on RSI i.e., the downtrend is weakening. However, if RSI closes below the horizontal line the divergence has been traded out and new Dollar Index are likely.
If the Dollar Index closes below 101.30 a swift sell-off down to the 0.618 retracement of the entire uptrend at around 98.94 should be expected. 100 and 200 weekly SMA’s will provide some support but the Dollar Index could spike down to support at around 97.22 which is the upper level of the consolidation area in Q1 2022.
For the Dollar Index to reverse this bearish outlook a close above 104.85 is needed.

 

RSI divergence: When instrument price is making a new high/low but RSI values are not making new high/low at the same time. That is a sign of imbalance in the market and an weakening of the uptrend/downtrend. Divergence or imbalance in the market can go on for quite some time but not forever. It is an indication of an exhaustion of the trend

Disclaimer

The Saxo Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research 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 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. To the extent that any content is construed as investment research, you must note and accept that the 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 under relevant laws.

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

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo 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 or its affiliates.

Saxo Capital Markets HK Limited
19th Floor
Shanghai Commercial Bank Tower
12 Queen’s Road Central
Hong Kong

Contact Saxo

Select region

Hong Kong S.A.R
Hong Kong S.A.R

Saxo Capital Markets HK Limited (“Saxo”) is a company authorised and regulated by the Securities and Futures Commission of Hong Kong. Saxo holds a Type 1 Regulated Activity (Dealing in Securities); Type 2 Regulated Activity (Dealing in Futures Contract); Type 3 Regulated Activity (Leveraged Foreign Exchange Trading); Type 4 Regulated Activity (Advising on Securities) and Type 9 Regulated Activity (Asset Management) licenses (CE No. AVD061). Registered address: 19th Floor, Shanghai Commercial Bank Tower, 12 Queen’s Road Central, Hong Kong.

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. Trading in leveraged products may result in your losses exceeding your initial deposits. Saxo does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo does not take into account an individual’s needs, objectives or financial situation. Please click here to view the relevant risk disclosure statements.

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

The information or the products and services referred to on this site 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 are not directed at, or intended for distribution to or use by, any person or entity residing in the United States and Japan. Please click here to view our full disclaimer.

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