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Technical Update - EURUSD testing 200 DMA, USDJPY finding bids and Dollar Index back to 104.40? Technical Update - EURUSD testing 200 DMA, USDJPY finding bids and Dollar Index back to 104.40? Technical Update - EURUSD testing 200 DMA, USDJPY finding bids and Dollar Index back to 104.40?

Technical Update - EURUSD testing 200 DMA, USDJPY finding bids and Dollar Index back to 104.40?

3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  EURUSD sold off heavily after being rejected at 1.10. Will it test 107.65 support?
USDJPY below 147 but finding bids
Dollar Index bouncing but can it bounce to 104.40 resistance

EURUSD seems to be in correction mode after being rejected at 1.10 resistance followed by a bearish break out of the rising wedge like pattern.
Currently finding support, and bouncing, from the 0.382 retracement at 1.0826. A break below 1.0820 could see EURUSD testing strong support at around 1.0762. However, a dip down to the 0.618 retracement at 1.0708 should not be ruled out.

However, the uptrend is intact supported by positive sentiment on the RSI and no divergence, indicating EURUSD is trading higher after a correction

There is some conflict between the medium- and longer term trends illustrated by the 100 Daily Moving Average declining and the 200 DMA rising which can result in a tug of war between Bulls and Bears around the Moving Average levels i.e. current levels and 1.0760
Source all charts and data: Saxo Group
USDJPY seems to be finding some support at the 0.382 retracement at 146.30. Trend is confirmed down however, supported by negative sentiment on RSI. A break below today’s low at 146.20 is likely to see another round of sell-off down top support at around 144.75.
But a dip down to the 0.618 retracement should not be ruled out.
For USDJPY to reverse to uptrend a close above 149.75 is needed

The Dollar Index is bouncing to test the 200 DMA but downtrend is intact. Bounce could continue to test upper falling trend line possibly spiking to test key strong resistance at around 104.40

RSI is showing negative sentiment with no divergence indicating lower Index levels are likely. A move to the 0.618 retracement at 102.21 with a spike down to test support at around 101.60 could be seen. That could be an exhaustive move but it remains to be seen and confirmed.

If The Dollar Index bounces to close above 101.40 the current bearish picture is demolished

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