USD charts bearish inverted hammer

USDollar

The above is the daily USD daily chart. Yesterday’s price action is showing an inverted hammer, which is a bearish candlestick (red rectangle). Moreover, the RSI(9) is dipping below 50, which is indicative of an underlying bearish momentum (blue rectangle). This follows from what seemed to be a fairly hawkish and upbeat Fed that indicated that four interest rate hikes are a distinct possibility in 2018. Despite this, the green 5-day EMA pushed slightly below the orange 13-day EMA i.e. the bullish EMA formation has ended. Today’s market action has seen follow through by the bears (still to complete). Given the ECB news release today, it will be interesting to see how the USD closes today. I.e. a close below yesterday’s period low is likely to be bearish.

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