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EUR/USD Descending Triangle In Play, USD/JPY Threatens Resistance

Published 08/19/2014, 12:47 PM
Updated 07/09/2023, 06:31 AM
EUR/USD
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USD/JPY
-
DX
-

Talking Points
  • EUR/USD Risks Break Below 1.3300 as Descending Triangle Remains in Play
  • USD/JPY Needs Close Above 102.80-90 Resistance to Favor Topside Targets
  • US DOLLAR Clears 10,590 Pivot as Housing Starts, Building Permits Beat Forecast

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10592.22

10594.72

10557.15

0.32

131.22%

EUR/USD

  • EUR/USD outlook turning increasingly bearish as it fails to hold above 1.3330; descending triangle continues to favor downside targets.
  • Will look for the Relative Strength Index (RSI) to push back into oversold territory for confirmation/conviction.
  • The DailyFX Speculative Sentiment Index (SSI) ratio suggests retail crowd is buying into the decline as the ratio climbs to +2.00.

USD/JPY

  • Bullish RSI momentum favors topside objectives; has failed to close above 102.80-90 since April.
  • Need a break & close above this key region to favor a further advance in the USD/JPY.
  • May see the USD/JPY attempt to carve a higher-high after marking a higher-low at 101.50.

FX Data

US Dollar: Daily

Chart - Created Using FXCM Marketscope 2.0

US Dollar Index

  • Dow Jones-FXCM U.S. Dollar Index rallies to a fresh monthly high of 10,591 as U.S. Housing Starts & Building Permits top market expectations.
  • Need a close above the 10,590 pivot given the previous failed attempts to see a further advance ahead of the Federal Open Market Committee (FOMC) Minutes.
  • Will look for a greater rift going forward as Philadelphia Fed President Charles Plosser dissents in August.
  • Interim Resistance: 10,602 (38.2% retracement) to 10,615 (78.6% expansion)
  • Interim Support: 10,440 (78.6% retracement) to 10,450 Pivot

Release

GMT

Expected

Actual

Consumer Price Index (MoM) (JUL)

12:30

0.1%

0.1%

Consumer Price Index Ex Food & Energy (MoM) (JUL)

12:30

0.2%

0.1%

Consumer Price Index (YoY) (JUL)

12:30

2.0%

2.0%

Consumer Price Index Ex Food & Energy (YoY) (JUL)

12:30

1.9%

1.9%

Consumer Price Index Core Index s.a. (JUL)

12:30

238.520

238.311

Consumer Price Index n.s.a. (JUL)

12:30

238.316

238.250

Housing Starts (JUL)

12:30

965K

1093K

Housing Starts (MoM) (JUL)

12:30

8.1%

15.7%

Building Permits (JUL)

12:30

1000K

1052K

Building Permits (MoM) (JUL)

12:30

2.8%

8.1%

--- Written by David Song, Currency Analyst

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