The following are the intraday outlooks for the USD Index (DXY), EUR/USD, GBP/USD, USD/CAD as provided by the technical strategy team at SEB Group.
USD INDEX: Revisiting the 1985 trend line. The greenback has now retraced back to a primary target area, the earlier broken 1985 trend line and the former wave four triangle apex/low area. So our best guesstimate is that buyers will be returning in the 93.80 – 93.25 area and that a spike, a false break below the long term trend line probably will be enough to spark some bargain hunting.
EUR/USD: Last leg higher in this advance. If our assumption plays out right the rise that begun Tuesday will be the last part of the rise from the April low and as such ideally peak in the 1.1415 – 1.1534 area (Q1 mid body point & a previous wave 4 reaction high). The fact that we both in hourly and daily charts are finding emerging divergences supports our view.
GBP/USD: Ending the correction higher. After having traced out five waves lower (in an hourly chart that is) from the peak of the correctional wave C the pair has slowly edged back towards the mid body point of the May 1 falling benchmark candle, 1.5252, which marks the ideal target for the minor correction. Possibly we have to await the outcome of today’s general election before market forces will start pushing prices lower again (below 1.5150 selling should getting traction).
USD/CAD: A "Double-bottom" in place? Price/momentum divergence should be noted as the market has nailed a potential "Double-bottom" in the short-term picture. This may be enough to keep the still ascending 233day exponentially weighted moving average band (1.1825/1.1725) out of reach. But for confirmation of this setup, 1.2205 must be reclaimed. Follow-through to and beyond the 55day exponentially weighted moving average band (1.2250\1.2390) would also be good to see.
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