Trade view /
12 September 2016 at 11:07 GMT
USD Index: Friday saw the second day of dollar gains as we push higher from the 94.44 low. Technically, this is seen as a possible right shoulder in a larger reverse Head and Shoulders pattern.
Although we have drifted lower from Friday's high, this has only posted inside bars and highlights the lack of strength in the correction. We are buying dips
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Source: Saxo Bank
Go short again in EURUSD this morning and here is why:
Monthly: For the last 19 months the major currency pair has been stuck within a relatively tight range (1.1714-1.0461). We have a Fibonacci confluence area and trendline support at 1.0000. This is our main focus.
The bearish Outside Month in May offers a mild negative bias and we have seen little net movement since this bar closed.
Weekly: Highlights a consolidating triangle that has an eventual bias to break lower. The next downside focus is going to be on the 1.0760 area.
This is a Fibonacci confluence area and previous support.
Four hour: This timeframe highlights the last move higher being mixed and volatile, common in corrective patterns. We are just trying to break the trend of higher lows as I write (1.1222). The next downside barriers are 1.1140 and 1.1100.
Management and risk description
Entry: short at 1.1241.
Target: intraday 1.1165; parity over the medium term
Time horizon: the medium term time-frame is unknown. We need to break the triangle to get an indication
— Edited by Michael McKenna
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