Here is a technical summary of what happened today in the majors:
EUR/USD– For the 3rd straight day, the Euro rallied higher against the Dollar. It’s been trying to get up to its previous swing high at 3250 but hasn’t quite gotten there yet. However, today’s candle has finally shown a close above this level which could indicate more upside movement for the pair.
Result: The Euro made its 3rd straight gain against the Dollar and finally closed above 3200 which has been a pretty good resistance level the past few days.
GBP/USD- Once again the Cable made no new advancements and we saw extremes in both the Dollar and Sterling’s favor. Early on, the Sterling fell to as low as 9266 but proceeded to rally during the US session and ended up closing higher agains the Dollar for the day.
Result: Although the Cable closed higher we’re still seeing no real movement from this pair. Indecision is still playing a big role in its movements.
USD/CHF- The Swissy continued to push the Dollar lower and brought it to as low as 2100 which was the previous swing low that was made on March 4th. 2100 proved to be good support and the Dollar rallied from there and pushed the pair higher, eventually closing at 2163, which was only 13 pips lower than its open.
Result: The Swissy started off another strong push against the Dollar but only managed to make a small gain against it at the end of the day.
USD/JPY- The Yen was unable to break 116.00 today and as a result the Dollar made a strong rally against it today. Once the pair bounced off of 116.00, it never looked back and made a nice close above 117.00. This rally snaps a 2 day winning streak for the Yen.
Result: The Dollar rebounded from 2 straight losses and rallied strong against the Yen today.
Chart Analysis: What’s going to happen next?
Ahhh the Euro finally closed above 3200 and it got as high as 3244. So it didn’t quite make it to 3250 but the close above 3200 seems encouraging. I think we’ll see another Euro rally tomorrow and I’m pretty sure this time it will reach 3250. Both 4hr and daily stochastics are still trending up and are not in overbought territory yet which supports my Euro rally theory.
Ok so the Cable did move down towards 9200 like I said yesterday but of course, the Cable being as choppy as it is lately, rallied from that point and actually closed higher today. Daily stochastics looks like it might be trending toward the upside now but it’s still not entirely clear. 4hr. stochastics are trending up but will soon be in overbought territory. I think I am ready to try trading this pair again. Currently the pair is at 9356 and I will buy on a dip at 9330 and set my target for 9450 since that is where both the 50 EMA and 100 SMA seem to be headed. My stop will be at 9210 which was yesterday’s low.
Buy at 9330; Stop Loss= 9210; Target= 9450
The Swissy looks like it may have hit a bottom at 2100 and we might have another rally in store. 4hr stochastics are trending up and have just left oversold territory which means that we should see some upside movement in the near term. Daily stochastics are still trending down so another move down to 2100 isn’t entirely out of the picture but it may take a few more days for that to happen. My bullish forecast for the Swissy is that it will move to 2200 and possibly 2230.
Hmmm…the Yen can’t seem to make it to 115.00 again. Does this mean the market is poised for the Dollar to rally against it? Well right now, the technicals definitely show favor on the Dollar’s side. Both 4hr and daily stochastics are trending up nice and have plenty of room to move before reaching overbought territory. The only possible hindrance I see is the 200 SMA on the daily chart which is right around 117.60. Look for the pair to move to its 200 SMA and possibly even 118.00 tomorrow.