Trading 'buy the dip' on S&P 500, EUR/USD and EUR/GBP continuing downtrend? [Video]
|Yesterday we pointed out USD strength from Friday but price action on USD pairs has either reversed or consolidated ahead of today’s US CPI figures.
We see a clear downtrend on EURUSD and the Stochastic Oscillator is showing us an Overbought signal.
Price action has reached a key level of resistance at the 38.2% Fibonacci level so we may see a reversal here but, again, be aware of today’s CPI announcement.
Last week we were looking at a possible reversal on AUD and it seems to have happened.
AUDUSD broke this Double Top and a clear downtrend has started.
However, price action needs to break this key level of support which is also the 38.2% Fibonacci level.
We see that the ADX on EURGBP was showing us very little throughout August but has now indicated a downtrend.
However, before continuing down, we would wait for the Stochastic Oscillator to turn from Overbought.
Also, if we look at the Daily chart, we can see that price action needs to break this key level of support before falling to the next levels.
Looking at the US Indices, we see another classic “Buy the Dip” scenario, which has worked so well for us all year.
The Stochastic Oscillator is confirming and reversing from its Oversold status on the Daily chart.
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