Chart Signals: USD Breakdown Ignites Rallies in JPY and Resource Dollars

USD broke down overnight taking the pressure off a number of other currencies enabling them to rally, Resource dollars like CAD, NZD and AUD plus gold have taken advantage of this opportunity along with JPY .

USD broke down today taking the pressure off a number of other currencies enabling them to rally, Resource dollars like CAD, NZD and AUD plus gold have taken advantage of this opportunity along with JPY which saw USDJPY challenge 100.00 and GBP where cable regained 130.00. Crude oil continues to rally ahead of inventory reports while action in indices suggests corrections could be starting.

Asia Pacific Indices

Australia 200 continues to consolidate recent gains below 5,600 and 5,485 a Fibonacci level. RSI falling toward 50 indicates upward momentum slowing with the potential for a downturn in momentum.

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Japan 225 failed to clear 17,000 and has started to roll downward again taking out 16,675 a Fibonacci level on its way toward 16,570 with next potential support near 16,500 then 16.330 a Fibonacci level. RSI rolling over suggests a downturn pending. 

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Hong Kong 50 peeked above 23,000 then dropped back in what looks like a bull trap peak. RSI remains overbought indicating potential for a deeper correction. The pair has been trading between 22,890 and 22,970 with next potential support near 22,675.

North American and European Indices

US 30 is coming off an inside day consolidating near 16,600 as an 18,525 to 18,675 trading range emerges. RSI drifting toward 50 indicates upward momentum still slowing. 

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US NDAQ 100 has dropped back from 4,835 toward a retest of Monday’s 4,800 breakout point as new higher support. Initial resistance possible near 4,845 with next support possible near 4,740. Overbought RSI suggests potential for a pause or correction at some point.

US SPX 500 has started to roll over after trading up toward 2,195 Monday, falling back toward 2,180. The current advance still appears to be contained by the 2,200 round number with RSI indicating upward momentum levelling off. Initial support possible in the 2,170-2,175 area.

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UK 100 has paused in the 6,890 to 6,940 area below the 7,000 round number to work off an overbought RSI created by the recent advance. Initial support in a correction possible near 6,859 then 6,800.

Germany 30 is starting to roll over falling back from 10,815 resistance into the 10,640-10,740 zone with next potential support near 10,500 a recent breakout point. RSI rolling back under 70 confirms a trading correction underway.

Commodities

Gold remains under accumulation, picking up off another higher low near $1,340 and advancing on $1,350 as an ascending triangle continues to form below $1.375. RSI holding 50 and climbing indicates underlying upward momentum intact.

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Crude Oil WTI’s upswing within a $40-$50 trading range continues to accelerate. Oil has cleared $45.00 and its 50-day average near $45.40 with rising RSI confirming the move. The price has advanced on $46.40 with next potential resistance near $48.00 with initial support rising toward $46.00.

FX

US Dollar Index has turned downward with the 95.00 round number giving way to signal the start of a new downleg with the breakdown then confirmed by a retest of 95.00 as new resistance. Currently trading near 94.60, next potential support appears in the 93.00 to 94.00 area. RSI falling away from 50 also confirms the downturn.

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EURUSD has decisively cleared $1.1200, advancing on $1.1300 to confirm an upswing into the upper half of its $1.1000 to $1.1400 trading channel before settling back into the $1.1250 to $1.1290 area. RSI rallying up off 50 confirms momentum turning upward.

GBPUSD has regained $1.3000 which it really needed to clear to signal the start of a new upswing having bounced off of $1.2880. Initial support rises toward $1.2950, with next resistance possible near $1.3050 then $1.3080 and $1.3180.

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NZDUSD is bumping up against $0.7300 once again where a recent breakout attempt failed but a successful one would complete a bullish ascending triangle and signal the start of a new upleg that could challenge $0.7500 based on a measured move. Rising RSI confirms upward momentum increasing.

AUDUSD remains under accumulation advancing from another higher low on trend near $0.7640 toward $0.7700 with next potential resistance near $0.7755 then $0.7835.

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USDSGD continues to hold above $1.3340 channel support but at the same time the pair continues to struggle with resistance at its 50-day average near $1.3480. RSI suggests broader downtrend still intact.  

USDJPY plunged from near 101.00 down through the 100.00 big round number and on toward 99.50 before bouncing back toward 100.20. It remains to be seen if this is a bear trap washout or the first crack in support before a new downleg. RSI confirms downward momentum accelerating.

GBPJPY dipped under 130.00 and then bounced off 129.20 back up toward 130.90 in what looks like a bear trap reversal forming a hammer candle. It needs to retake 132.70 to call off its current downtrend with next resistance near 133.80.

EURJPY is holding steady near 113.00 as it tries to build a base in the 112.00 to 114.00 zone. RSI suggests downward pressure levelling off.

CADJPY is trading near 78.00 as it drops back from 78.80 resistance although higher lows for the pair and the RSI suggest base building may be underway.

USDCAD is breaking to the downside, taking out $1.2900 and falling toward $1.2840 with next potential support near $1.2800 then $1.2745 on trend. RSI under 50 and falling confirms downward momentum increasing.