USDX: Daily analysis for May 23, 2013
May 23, 2013 9:15 amVideo
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Daily chart: The USDX is preparing to make a breakout in actual resistance level at 84.22. The news was positive for USDX in yesterday’s session, therefore, is expected to be finished this lower high pattern, to climb to the resistance at the 85.18 level in the medium term. The MACD indicator remains in positive territory but is approaching to extreme overbought levels, so we must be cautious when making swing trading the USDX market.
H4 Chart: Similarly, the USDX is forming a lower high pattern and is looking to break the bullish trend line that is near the 84.60 level. If it breaks that trend line, it is expected to rise in the medium to long term to the level at 86.80 and for that reason, it would only look for buy orders on the USDX. In yesterday’s session, the USDX found support at 83.49 level, demonstrating the strength of this support that has tried to break in days before without success. The MACD indicator is in positive territory and showing that there is still a lot of strength in time bullish trend in this market. In short, only buy orders, unless economic data are released today and tomorrow, are negative for the U.S. economy.
H1 chart: During yesterday’s session, 2 Points Of Control (POC) were formed below the current price of the USDX, one at the level of 84.18 and the other at the level of 83.90. As we had said yesterday, the USDX found dynamic support moving average of 200 and made a strong bullish rebound almost 70 pips, leading to resistance in the 84.37 level. Now the USDX market is forming a lower high pattern below that resistance and if it is broken it is expected to rise to psychological resistance at 95.00. On the other hand, the MACD indicator is showing overbought levels in the USDX, which may be forecasting that the USDX will make a consolidation in a low range for the rest of the week, but we should not rule out strong movementsin the USDX market due to the sensitivity that this market has, before the publication of economic data in the United States.
Fundamental Outlook: For today’s session in the United States the Unemployment Claims (Previous: 360K / Forecast: 347K) and at 14:00 GMT will be published, the New Home Sales (Previous: 417K / Forecast: 429K) will be revealed. If the current reading is higher than the forecast, we would expect bullish movements in the USDX market during the hour, so, be cautious the opening during the New York session.
Trading recommendations for today: Based on the H1 chart, place BUY (long) orders only if the USDX market breaks with a bullish candlestick, the resistance level is at 84.37, take profit is at 84.85, and stop loss is at 83.95.
The material has been provided by InstaForex Company – www.instaforex.com
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