Currency Pair Overview: Dollar Finds Strength During Overnight Session

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Currency Pair Overview:

Dollar Finds Strength During Overnight Session

Overall, the dollar is finding its legs during the overnight session. The major pairs have been hit with a bought of dollar strength early in the Asian session. Most of the majors have already moved 30 or more pips with the swissy and yen lagging behind with only a 10-12 pip change. The leading index was released from The Conference Board in Australia today with a reading of 0.3 percent.

The euro (Eur/Usd 1.4946) is declining at the start of the Asian session. The pair has had problems breaking above the 1.5050 barrier. However, strong support is noted near the 20 and 50 day moving averages in the 1.4800 area.

The pound (Gbp/Usd 1.6589) is breaking lower, falling below the 20 day moving average at 1.6600. The pair was looking for support near the neutral swing point. Below that the pair will find more support at the 1.6475 level.

The aussie (Aud/Usd 0.9216) is trading its way lower during the overnight session. The aussie has fallen below the neutral swing point located at 0.9215. The 20 day moving average is acting as support at the 0.9188 level.

The cad (Usd/Cad 1.0586) fell below the 20 and 50 day moving averages which are trading near the 1.0610 area. During the overnight session the pair is testing that level as resistance. The cad found support at the 1.0540 area earlier.

The swissy (Usd/Chf 1.0108) is following the trend among the majors as the dollar finds some strength in the overnight session. The pair will likely encounter some resistance near the neutral swing point at 1.0120, while support is seen at 1.0075.

The yen (Usd/Jpy 88.88) is currently trading below the neutral swing point at 88.90 during the session. The yen has been finding major support in the 88.60 area suggesting that institutional buying is taking place here.

TheLFB Charting: Gold Elliott Wave view

4 Hour Chart Flows: Long Price Points: 1180, 1200 Looking for: A Wave 5) top, (that just keeps moving higher)

Momentum: Gold bullion moved into another long momentum cycle on 3rd Nov, and easily held the long break of 1060 that came with it. The pull-backs are getting bought when they hit an oversold 4 hour chart sentiment read, every 4-5 days. The current oscillator reads are as overbought as we have seen in the entire move up from 950.00 to 1160.00, and therefore we will be looking for a reversal to support, and looking to bank existing rather than buy new at these levels. The 1180 and 1200 areas look to be potential reversal points, with 1130 and 1100 momentum and sentiment price points.

Elliott Wave: Gold has broken through the previous 1052 highs, and as such traders may be targeting the1200 area, before a blue wave V reversal, that is looking for the red wave 5) complete.

Gold values are reflecting U.S. dollar weakness that has held in place over the last few months. Traders with a long dollar bias should wait on resistance to be hit on gold before looking for the Usd to easily trade higher again. In this case, the 1200 resistance are could be the key for a reversal.

TheLFB Charting: S&P Futures Elliott Wave view

4 Hour Chart Flows: Long Price Points: 1082, and 1112 Looking for: A break of 1082 or 1112 to signal mid-term sentiment

Momentum: S&P futures went into long mode in the near-term on Nov 13th and have easily held that trend, and that has allowed the tests of 4 hour chart support to be bought. There is a tight sideways channel forming and that is allowing the move from overbought to oversold, and back again, to be completed over a 5 day period. It seems to be a meander higher at the moment.

Elliott Wave: S&P futures were lower at the end of the past week, but the market became extremely bullish again after traders were unable to push the prices through the significant 1082 support region.

Traders with a short bias should be very patient here, as another move into the yearly highs may follow over the coming days, if Asian and European equity markets can hold support. In this case major currency pairs will benefit against the U.S. dollar.

TheLFB Charting: Eur/Usd Elliott Wave view

4 Hour Chart Flows: Long Price Points: 1.4800, and 1.5000 Looking for: A move higher, within the existing bear channel

Momentum: The pair went into Neutral mode on 26th October and has struggled to find the momentum to create and hold a long trend. The sentiment is flowing from overbought to oversold in quick time and is following the global market open and close of Asian, European, and U.S. commercial markets. This is a tight trading range.

Elliott Wave: The Eur/Usd pair  is still trapped between the 1.4800 support and 1.5000 resistance zone. A break of the psychological 1.5000 level will put bullish targets in play somewhere around 1.5200, if traders can initially break and hold a daily chart close above the current 1.5062 yearly highs.

Overall, it seems that the market has been forming a short A), B), C) correction in the past two weeks, which will signal for another bullish leg to come. Prices are still trapped in an overall bear channel, so traders need to be patient until the break appears.