Left Daily Chart
- FXCM's USDOLLAR is down on the day as it unwinds an overbought condition (black rectangle).
- However, the daily candlestick chart remains in its bullish channel, between the upper blue and red bands.
- If the daily chart remains in this channel and its RSI above 50, there will be an underlying bullish momentum driving the greenback.
- This will make dips in the uptrend interesting.
Right Hourly Chart
- The hourly candlestick chart has pulled back to a confluence of support.
- This level of support coincides with the S2 pivot, a 50% retracement and price support (green shaded horizontal).
- The hourly stochastic has dropped below 20. If it maintains this position the support will battle to hold.
- However, if the trend-following EMAs and the stochastic cross up, the dollar bulls may be satisfied that the daily overbought condition has unwound sufficiently.
- Last Friday saw inflation data come in above expectations.
- This Friday will see the release of non-farm payrolls. If this also prints hotter than expected, the USDOLLAR will likely be supported.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.