Currency market: EUR/USD v DXY and USD/JPY
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From btwomey.com. Jackson Hole 2017, EUR/USD rose for the day at 169 pips Vs Last week's Jackson Hole at 143 pips. DXY in 2017 dropped 103 pips Vs last week at 129 pips. No changes in 5 years.
In 2017, DXY traded 92.42 and EUR/USD at `1.1900's or a spread at 2600 pips Vs today's spread at 800 ish pips.
The answer is not in the spreads but the averages. EUR/USD trades 1400 pips from the 5 year average at 1.1471 and deeply oversold from the 50 day average at 1.0137 to the 5000 day averages in 1999. EUR/USD 5 year average in 2017 was 1.2000's.
USD/JPY trades massively overbought from the 10 day average at 137.33 to the 5000 day averages. USD/JPY trades severely overbought from the 5, 10 and 15 year averages at 111.00, 109.00's and 102.00's. The 5 year average in 2017 was at 106.00's.
DXY 5 year average is located about 1200 pips from current 108.00 at 96.00's.
The same 1200 pips is seen from current GBP/USD Vs USD/CAD.
The current EUR/USD Vs DXY and non USD currencies trades at wide extremes and must compress. The 5 year averages are moving at roughly 100 pips per year.
Top ranked AUD/JPY was the winner this week with yesterday's 154 pip drop and beat all JPY cross pairs.
EUR/USD 1.0072 traded to 1.0053 highs from 0.9914 lows. EUR/USD requires a weekly close above 0.9989 to consider a trend higher in focus. Target would then become 1.0133. The current driver at 1.0276 would then travel higher to allow EUR/USD to rise.
Below 0.9989 then EUR/USD contains ability to trade to a lower degree of oversold.
As mentioned in the weekly, EUR/USD cross pairs would outperform and this was the case yesterday.
Best trades for this day is EUR/AUD, EUR/NZD, EUR/CAD, GBP/USD and USD/CAD.
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