US Dollar Weakness Drives Price Action

• 6 Oct 2020

USD/JPY

USD/JPY buyers have awakened taking the pair back towards the range ceiling at the 106.05 price level. This resistance area has proven to be an obstacle in the past as the pair continues to make lower highs. Longer-term sentiment is bearish. Momentum indicators have flattened in neutral territory.  

 

 

 

 

 

EUR/USD

The Eurodollar has moved passed the 1.172 resistance level to return to the previous trading range. At this price level the pair entered into a period of consolidation with tests of the 1.192 ceiling resulting in bearish rebounds. Momentum indicators are beginning upward trajectories. 

 

 

 

 

 

GBP/USD

The GBP/USD pair is tracing the ascending trendline and has moved to test a previous resistance area at the 1.298 price level.  On a previous occasion, price action pulled back at this price level, therefore buyers’ conviction will be tested. Momentum indicators have upward trajectories.  

 

 

 

 

 

USD/CHF

The USD/CHF reversal appears to be underway as a break of the 0.918 support level provides weight to the sell-off. The descending trendline reflects the longer-term bearish sentiment which may now resume. US Dollar volatility is to be expected going forward. Momentum indicators have downward trajectories. 

 

 

 

 

 

USD/CAD

The USD/CAD pair has returned to the 1.322 support area, as US dollar weakness influences price action to the point that movements in commodities market are not reflected in the pair. A break of the support level would indicate a return to the previous downtrend and trading range. Momentum indicators have begun downward trajectories. 

 

 

 

 

 

GOLD

Given the struggle to break the 1904.89 price level, it is fair to assume buyers appetite is waning. Price action oscillates moderately yet neither buyers nor sellers have gained ground. Horizontal trading appears likely to continue in the near-term. Momentum indicators have upward trajectories. 

 

 

 

 

 

OIL

WTI has rebounded once again from the 36.93 support level to now test the $39 price area. Whether the commodity can sustain the bullish momentum and return to the $40 per barrel range remains to be seen. Supply and demand fundamentals appear to have broken down. Momentum indicators remain in bearish territory.