• 698 days Will The ECB Continue To Hike Rates?
  • 699 days Forbes: Aramco Remains Largest Company In The Middle East
  • 700 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,100 days Could Crypto Overtake Traditional Investment?
  • 1,105 days Americans Still Quitting Jobs At Record Pace
  • 1,107 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,110 days Is The Dollar Too Strong?
  • 1,110 days Big Tech Disappoints Investors on Earnings Calls
  • 1,111 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,113 days China Is Quietly Trying To Distance Itself From Russia
  • 1,113 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,117 days Crypto Investors Won Big In 2021
  • 1,117 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,118 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,120 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,121 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,124 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,125 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,125 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,127 days Are NFTs About To Take Over Gaming?
Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

  1. Home
  2. Markets
  3. Other

Technicals Show Room For More USD Weakness After The US Government Shutdown

USD is sharply down across the board after the US government shutdown. Some would think that US stocks futures will turn lower, but we in fact can see higher prices since the news came out. However, we may see a risk aversion (lower stocks) if government will be shutdown for too long, lets say around 3 weeks. In the past the longest close was 21 days, back in 1995 (source Wikipedia). The longer the shutdown will last, more nervous investors will become.

From a technical point of view we see room for more USD weakness as long as market trades beneath 80.75. Meanwhile of course we expect higher majors, such as EUR, GBP, CHF and even AUD which is also bullish and supported fundamentally after RBA kept rates unchanged at 2.5%.

USD Index daily

US Dollar Index Daily Chart

On the AUDUSD chart we can see that pair found a support around 0.9220-0.9300 area, at former wave four from where we have seen a nice bullish reversal with a decisive break through the upper trend-line of a corrective channel (circled zone). This break indicates an uptrend continuation for AUDUSD that is now pointing back towards 0.9528. Force index is also reversing higher now suggesting that volume and momentum are coming back into the market.

AUDUSD 4hElliott Wave Analysis Chart

AUD/USD 4-Hour Chart

In fact, notice that latest decline on AUDUSD was in three legs, labeled as A-B-C. This is a structure of a contra-trend price action, called a zigzag. When zigzag is complete, the pull-back will normally be fully retraced.

With that said, we expect more upside on AUDUSD.

 


Written by www.ew-forecast.com | Try EW-Forecast.com's Services Free For 7 Days at http://www.ew-forecast.com/service

 

Back to homepage

Leave a comment

Leave a comment