Patterns: USD/MXN, EUR/PLN
USD/MXN 1H Chart: Channel Up
The US Dollar has appreciated substantially against the Mexican Peso during the past three weeks. The pair managed to reach a five-month high at 18.84 on Tuesday evening. Subsequently, the Greenback edged lower and breached the diminishing trading range apparent since early October. The given currency managed to move below a strong support cluster formed by the monthly R2, weekly R1 and the 55-hour SMA. These factors suggest a possible downside momentum that could push the rate towards the lower channel boundary circa 18.60/65. A breakout of this line should be followed by a fall down to the weekly PP and the 200-hour SMA near 18.40.
EUR/PLN 1H Chart: Channel Down
EUR/PLN had been trading in an ascending channel since late August prior to breaching this pattern to the downside on Tuesday. The pair's movement during the past two weeks resembles a channel down; however, another bottom confirmation is still needed. Meanwhile, the common European currency has been testing the lower channel line for several hours, thus not being able to move below the 61.8% Fibonacci retracement. Technical indicators suggest that the rate should recover in the short term. A possible upside target could be the upper channel boundary circa 4.2950—a level which is reinforced by the 55– and 100-hour SMAs, the monthly PP and the weekly S1. In case of a downside momentum, the pair should be limited by the monthly S1 at 4.2560.
Author
Dukascopy Bank Team
Dukascopy Bank SA
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