#USDollar Nears Long-Term Support | $DXY $USD $XAU #XAG
Friends,
As a new week opens, a bird's eye view of the Forex market might be best appreciated if taken on the back of the US Dollar Index (DXY).
SOME FUNDAMENTAL POINTS AND OPINION:
At this point, fundamentals are expecting to carry the greenback upwards, on the general assumption that the Fed will continue to taper. We also discussed earlier weaknesses in the Chinese economy, which may weigh on the Yuan and cause a reflexive reaction among competing EM economies to pressure their own currencies downwards, thus leveraging against an upward USD pressure. Finally, there is also continued concerns in the falling value of Gold and silver, which will correlate to a buoying USD value.
In fact, our XAGUSD system is currently eyeing a bearish target of 18.651, whereas Gold has maintained a stagnant stance within our prior cautionary 1320/1330 reversal range.
TECHNICAL DATA:
The chart indicates a clear bullish trendline emanating from 28 NOV 2011 and providing a ranged support over the interim course of time. If a physical validation were to occur this week, I would look at 79.24 as a probable supportive value.
My predictive analysis and forecasting system offers the following targets and cautionary values.
First, if price continued to rise, two bullish targets are likely to act as significant resistance levels:
1 - TG-1 = 83.02
and
2 - TG-2 = 84.56
A powerful Wolve Wave pattern ("WW") remains in support of this bullish scenario, especially if the WW trader consider Point-1 at 78.99 and point-5' as the most recent candle bottom near the trendline (see pattern defined in the chart - Caveat: a purist might object that the pattern lacks a downward slope. I would then add that a 3-Drives pattern would also fit the bill).
Second: A break of the historical support trendline should concern vested bulls, and a break and close below 78.99 would open the floor to a significant support at 77.45.
OVERALL:
Several elements have favored a bullish expectation. We cited some general fundamental causes, defined technical directional biases and targets.
However, major determinants that might push the US Dollar upwards are:
1 - AFed rate hike,
2 - A combination of negative rate decision and/or QE activation from ECB,
or
3 - A significant increase in short term T-bills (i.e.: 3-Mos, IRX) over mid-term T-Bonds (i.e.: 10-Yr Trys., TNX), as early indicator of broad sentiments shifts and risk aversion impacting Forex (proxy: USDJPY) - All of these are worth charting and tracking very closely.
For the time being, the directional indicator remains at NEUTRAL-TO-LONG until cleared market action and a definite bullish market reversal comes out of my system.
Cheers,
David Alcindor
Predictive Analysis and Forecasting
Get my signals, analyses and forecasts on Twitter:
(Alias: 4xForecaster)
-------------------------------------
Disclaimer:
- All my comments are founded on unshared proprietary as well as common knowledge of technical analysis: Do your own due diligence before trading any market/asset. Additionally, my signals, forecasts, analyses and directional opinions are for educational purposes only and are not trading recommendations. Again, do your own due diligence first, then seek financial advice from a licensed professional, and only then enter the market at your own perils - David Alcindor - TradingView.com Alias: 4xForecaster
As a new week opens, a bird's eye view of the Forex market might be best appreciated if taken on the back of the US Dollar Index (DXY).
SOME FUNDAMENTAL POINTS AND OPINION:
At this point, fundamentals are expecting to carry the greenback upwards, on the general assumption that the Fed will continue to taper. We also discussed earlier weaknesses in the Chinese economy, which may weigh on the Yuan and cause a reflexive reaction among competing EM economies to pressure their own currencies downwards, thus leveraging against an upward USD pressure. Finally, there is also continued concerns in the falling value of Gold and silver, which will correlate to a buoying USD value.
In fact, our XAGUSD system is currently eyeing a bearish target of 18.651, whereas Gold has maintained a stagnant stance within our prior cautionary 1320/1330 reversal range.
TECHNICAL DATA:
The chart indicates a clear bullish trendline emanating from 28 NOV 2011 and providing a ranged support over the interim course of time. If a physical validation were to occur this week, I would look at 79.24 as a probable supportive value.
My predictive analysis and forecasting system offers the following targets and cautionary values.
First, if price continued to rise, two bullish targets are likely to act as significant resistance levels:
1 - TG-1 = 83.02
and
2 - TG-2 = 84.56
A powerful Wolve Wave pattern ("WW") remains in support of this bullish scenario, especially if the WW trader consider Point-1 at 78.99 and point-5' as the most recent candle bottom near the trendline (see pattern defined in the chart - Caveat: a purist might object that the pattern lacks a downward slope. I would then add that a 3-Drives pattern would also fit the bill).
Second: A break of the historical support trendline should concern vested bulls, and a break and close below 78.99 would open the floor to a significant support at 77.45.
OVERALL:
Several elements have favored a bullish expectation. We cited some general fundamental causes, defined technical directional biases and targets.
However, major determinants that might push the US Dollar upwards are:
1 - AFed rate hike,
2 - A combination of negative rate decision and/or QE activation from ECB,
or
3 - A significant increase in short term T-bills (i.e.: 3-Mos, IRX) over mid-term T-Bonds (i.e.: 10-Yr Trys., TNX), as early indicator of broad sentiments shifts and risk aversion impacting Forex (proxy: USDJPY) - All of these are worth charting and tracking very closely.
For the time being, the directional indicator remains at NEUTRAL-TO-LONG until cleared market action and a definite bullish market reversal comes out of my system.
Cheers,
David Alcindor
Predictive Analysis and Forecasting
Get my signals, analyses and forecasts on Twitter:
(Alias: 4xForecaster)
-------------------------------------
Disclaimer:
- All my comments are founded on unshared proprietary as well as common knowledge of technical analysis: Do your own due diligence before trading any market/asset. Additionally, my signals, forecasts, analyses and directional opinions are for educational purposes only and are not trading recommendations. Again, do your own due diligence first, then seek financial advice from a licensed professional, and only then enter the market at your own perils - David Alcindor - TradingView.com Alias: 4xForecaster
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