US Dollar, GBP/USD Talking Points:
US Dollar Back to Resistance
The US Dollar is back at the 98.00 level on DXY and this is the fourth such instance over the past eight days. It appears as though it’s a simple matter of time before buyers able to push up to fresh three-week-highs and given the higher-low support that’s shown over the past couple of days this keeps that theme alive with an ascending triangle formation. The price of 98.00 came in as the swing-high around FOMC and similarly came in to set the daily high on Tuesday morning as well as last night.
US Dollar Two-Hour Price Chart
US Dollar: Deeper Retracement in the Q4 Reversal?
The big item from last month was the bearish reversal in the US Dollar. The currency came into Q4 with a full head of steam, setting a fresh two-year-high on the first trading day of the quarter. But, the longer-term formation was showing as a rising wedge, which will often be approached with the aim of bearish reversals and that was the side looked at in the Q4 Technical Forecast on the US Dollar. That scenario played out through October and the US Dollar came into the month of November around two-month-lows. But so far this week USD bears have remained at bay.
This morning’s short-term bullish formation comes at odds with the slightly longer-term bearish backdrop. This highlights the potential for a deeper retracement in that bearish USD theme, focusing on lower-high resistance potential around 98.20 or the 98.33-98.50 zone.