Dollar index moves south of 91.00 ahead of US jobs data
(Technical changes over this period are often limited, although they serve as a guide for possible longer term movements)
After a three-month retracement, demand at 1.1857-1.1352 entered and inspired a bullish rally in April, up 2.4% at the close.
April’s rise highlights the possibility of further 2021 peaks in the coming months, followed by an ascending stress test (earlier support [1.1641]).
Based on trend studies, the primary The uptrend has been going on since the price broke the high of 1.1714 (August 2015) in July 2017. In addition, the price also broke through trendline resistance, taken from the high of 1, 6038, in July 2020.
The US dollar echoed a soft, tender your Thursday, with the US dollar index (symbol: DXY) breaking through 91.00.
Europe’s common currency, which holds the largest weight in the DXY, benefited from the drop in the USD, leaving the 200-day simple moving average at 1.1942 uncontested. The recent rise tilts the scales in favor of a Quasimodo stress test at 1.2169.
As aired in recent technical briefings, the currency pair has been entrenched in an uptrend since early 2020, a move that many traders will likely refer to as a main trend over this time frame.
The RSI – in conjunction with yesterday’s price advance – recorded a recovery of support at 51.36.
For those who have read Thursday’s tech briefing, you may recall the following (in italics):
Wednesday’s decline, as seen in the H4 scale, had EUR / USD shaking hands with support at 1.1990 and a Fibonacci cluster between 1.1971 and 1.1986 (an area defined on a chart where the Fib retracement levels converge). For now, buyers have welcomed the zone, but to add bullish conviction traders are likely on the lookout for a breakout of yesterday’s high at 1.2026 or a bullish candlestick pattern for form.
As the H4 chart shows, the EUR / USD bulls entered an offensive phase from the 1.1971 / 1.1990 support area on Thursday and peaked at 1.2071. Monday’s highs around 1.2075 echo possible resistance, with subsequent buying potentially setting the technical ground for an approach of drawn resistance at 1.2108.
Thursday’s technical research noted the following (italics):
As the H1 chart shows, 1.20 did indeed embrace a slight boost on Wednesday, allowing support at 1.1989 to enter the fray. However, bullish attempts have been somewhat lackluster so far, unable to score a new high and reach H1 resistance at 1.2035.
As you can see, however, Thursday ruled out both the 100-period simple moving average and the resistance at 1.2035, thus highlighting the offer at 1.2091-1.2077 and the figure of 1, 21 located above.
The RSI movement, after a brief spike in the overbought space, settled around 66.00ish. Note that recent action has left RSI resistance untapped at 78.97.
With monthly price eye higher ground, in addition to the daily flow showing the possibility of approaching Quasimodo resistance at 1.2169, the H4 stock could overcome Monday’s peak at 1.2075 today and possibly clear the river north to the resistance pinned at 1.2108.
The above analysis could therefore strengthen a new support test of 1.2035 on the H1 scale, targeting the H1 supply at 1.2091-1.2077 and the figure of 1.21 (which closely aligns with the resistance H4 mentioned above at 1.2108).