Brian Twomey
Brian's Investment
EUR/USD begins the week not correlated to its cross pairs and explains why EUR/USD traded lower into deeply oversold. EUR/USD achieved 1.1708 lows at its maximum extreme and only corrected to 1787. A correctly corrrelated EUR/USD should've seen highs to minimum 1.1860's to resume the downtrend in place since the break at 1.1944. Current 1.1905 must break for a higher EUR/USD.
EUR/JPY and all JPY cross pairs remain deeply overbought as JPY cross pairs are correlated to USD/JPY. Overbought USD/JPY travels higher despite deeply overbought status. USD/JPY is held by 108.95 and 107.67. USD/JPY follows severely overbought USD/CHF. Ahead for USD/CHF is the 5, 10 and 14 year averages at 0.9503, 0.9717 and 0.9886. Look for shorts at 0.9437 to target 0.9363 easily.
Part explanation to USD/JPY and USD/CHF to trade higher in overbought is DXY rise from 89.95 lows to current 94.03. Current DXY range trades 92.78 to 94.39 from its close at 94.03. Above 94.39 targets many and massive resistance averages at 95.00's beginning at 95.07, 95.41, 95.54, then 95.83 and 95.86. From 94.39 could easily decide the fate to USD/JPY and USD/CHF to turn lower.
GBP/USD and cross pairs are strongly correlated except for wide rangers GBP/NZD and GBP/AUD. Both GBP/NZD and GBP/AUD begin the week deeply overbought due to +90% correlations to USD/JPY and USDCHF. GBP/NZD and GBP/AUD drop when USD falls.
GBP/AUD must break 1.8138 to target 1.7983 and GBP/NZD is well supported at 1.9419 and 1.9379 from its close at 1.9648. GBP/NZD targets low 1.9500's at best this week.
GBP/CAD do or die point exists at 1.7373 from its close at 1.7379. Nothing special to bother with GBP/CAD and despite a GBP/USD correlation at +65%.
AUD/USD, NZD/USD and EUR/USD broke below vital downtrend lines however GBP/USD remains the later follower as it must break 1.3692 to target lower levels. GBP/JPY and GBP/CHF begin the week overbought and GBP/USD correlates +90% to GBP/JPY and +87% to GBP/CHF.
GBP/JPY awaits the deep dive to minimum 149.00's.
Overall Correlations are deeply entangled inside USD and non USD pairs and explains dead price movements. A break out is required to see prices move again.
USD/CAD aas usual is the outlier to USD/JPY and USD/CHF as it remains oversold and heading higher. EUR/AUD may correlate +58% to EUR/USD but +99% to USD/CAD. Despite fairly neutral for EUR/AUD to begin the week, higher it will travel as AUD/USD trades lower.
NZD/USD do or die at 0.7052. GBP/US runs strong Correlations to NZD/USD at 74% so expect GBP/USD and NZD/USD to travel together. NZD/CAD and NZD/USD trade below 0.7052 and 0.8945. Now waiting on NZD/JPY and NZD/CHF drops.
EM
USD/BRL massively overbought short, medium and long term targets much lower at 5.6187 from its close at 5.7080. A break at 1.5608 is required to target lower levels.
USD/CZK watch 22.00 break lower to target 21.81. Not much to CZK.
USD/DKK Remains overbought and targets 6.2750 then 6.2620. A break at 6.2490 is required to head miles lower.
USD/HUF week 2 to fairly neutral and targets 305.34 on break of 306.25. Then long to target 308.06.
USD/MXN 20.60 required to move higher and target 20.76 and 20.83 easy. USD/MXN begins the week deeply oversold with a 20.56 target from its close at 20.31. The old MXN seems to have completely vanished.
USD/MYR begins the week slight overbought and targets last week;s 4.1237. Short is the strategy.
USD/PLN fairly neutral to begin the week. Shorts at 3.9334 and 3.9423 to target 3.8976 easily.
USD/RON begins the week deeply overbought and targets 4.1411 then 4.1354.
USD/TRY also begins the week deeply overbought and targets 7.8954 easily then 7.8595.
USD/ZAR Oversold Zar targets higher at 14.7405 then 14.8251.
Trading currencies and other financial instruments carries a degree of loss and possible loss of entire investments. Please managed your own risks, stop loss, and margins requirements.
Recommended Content
Editors’ Picks
EUR/USD rises toward 1.0700 after Germany and EU PMI data
EUR/USD gains traction and rises toward 1.0700 in the European session on Monday. HCOB Composite PMI data from Germany and the Eurozone came in better than expected, providing a boost to the Euro. Focus shifts US PMI readings.
GBP/USD holds above 1.2350 after UK PMIs
GBP/USD clings to modest daily gains above 1.2350 in the European session on Tuesday. The data from the UK showed that the private sector continued to grow at an accelerating pace in April, helping Pound Sterling gather strength.
Gold price flirts with $2,300 amid receding safe-haven demand, reduced Fed rate cut bets
Gold price (XAU/USD) remains under heavy selling pressure for the second straight day on Tuesday and languishes near its lowest level in over two weeks, around the $2,300 mark heading into the European session.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
US S&P Global PMIs Preview: Economic expansion set to keep momentum in April
S&P Global Manufacturing PMI and Services PMI are both expected to come in at 52 in April’s flash estimate, highlighting an ongoing expansion in the private sector’s economic activity.