The EUR/USD V DXY relationship crossed in 2003 at 101.00's. EUR/USD by July 2008 traded to 1.6000's and DXY achieved lows at 73.00's and 71.00's. DXY dropped 2800 pips while EUR/USD rose by 5900 or 2 X's DXY.
Since 2003, its customary for EUR/USD to outperform DXY and to trade above DXY and long while shorts to DXY amd USD. The 2003 cross further allowed Brent Oil to trade above WTI, DAX above Dow Jones yet XAU/EUR below XAU/USD and European Ester rates below Fed Funds.
European ester trades 4 points per day and 702 transactions by 33 banks at the 25th and 75th percentiles. Ester will trade monday from 3.93 to 3.89. fed funds trades 14 points per day at the 25th and 99th percentile. Japanese call rates trades roughly 22 points per week at 4.4 points per day to match european ester. The full ranges assumes a full trade day. many days, interest rates move by 1 and barely 2 points. Monday are good examples.
DXY trades overbought and oversold EUR/USD. On the upside, EUR/USD is matched by DXY at 107.18 V EUR/USD 1.0745. DXY 108.26 V EUR/USD 1.0868. DXY 109.03 Vs EUR/USD 1.0909.
Both DXY and EUR/USD are matched on the downside from 1.0500's to 1.0200's.
The EUR/USD strategy is long to target 1.1010 by breaks at 1.0745, 1.0844 and 1.0920. EUR/USD first minimum target for the week is 1.0683 and places DXY right at 105.06.
USD/JPY was caught in the DXY Vs EUR/USD crossfire over last weeks by following DXY higher. USD/JPY remains massive overbought from averages at 106.00's to 143.00's. Lower averages from 106.00's to 130.00 's trades at near extremes.
USD/JPY lower is required by a DXY drop. For the week, low 148.00's are blocked and the range for the week trades long 148.00's and short 150.94.
GBP/JPY bottoms trade 181.22, EUR/JPY 156.83 and CAD/JPY at 108.95.
GBP/CAD hits a brick wall at 1.6600's and 1.6700's while EUR/CAD's wall at 1.4500 are many and solid. Both EUR/CAD and GBP/CAD trade deeply oversold for the week. EUR/CAD's weekly line is located at 1.4421 and 1.6651 for GBP/CAD.
NZD/CAD trades oversold however watch shorts at 0.8112.
AUD/USD trades oversold for the week and targets the break above 0.6508. NZD/USD begins the week in a terrible position. The forcus is on 0.6020. Overall NZD/USD trades deeply oversold from 0.6000's to 0.7100's and contains a long way to travel higher. AUD/USD trades oversold from 0.6500's to 0.8000's.
GBP/USD must trade to minimum 1.2348 and on the way to the break at 1.2427 to target 1.2736 long term.
GBP/JPY big line for the week is located 184.11 and 158.80 for EUR/JPY. For the week, we remain short to target the GBP/JPY break at 180.20 and 155.88 for EUR/JPY.
JPY cross pairs
GBP/JPY, EUR/JPY and CHF/JPY trade oversold while AUD/JPY and NZD/JPY begin the week at Richter Scale overbought.
Japanese financial futures exchange
Most widely traded currencies in order by 138 members: EUR/USD, CHF/JPY, EUR/JPY, USD/JPY, GBP/JPY, CAD/JPY, NZD/JPY, AUD/JPY, ZAR/JPY, TRY/JPY.Not much interest exists to ZAR/JPY and TRY/JPY.
Trade Volume for August 1,051,023,737. Fairly historic highs. From 9, 235, 351 total positions and in millions: Longs account for 4,733, 916 and Shorts 4,501,435.
EUR/AUD higher must cross 1.6515 and 1.9101 for GBP/AUD. EUR/AUD has easy ability to trade 1.6200's and GBP/AUD at 1.8700's.
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.