Stock Incubator

[dalcindo]

Re: USD vs. XAU (gold) vs. EUR:

Overview: At close of last week, USD's daily secondary indicators were lining up into a pre-decline pattern. This raised the question whether the USD is resting from a short-term rally before continuing its dismal descent. At this week's open, I will venture to say that the USD is weakening, as per its delay chart pattern, as well as that of XAU and EUR.


USD
Today, at a new week's open, the USD seems to confirm this break-down pattern, as the USD closed today at the level of last week's half candle height.

Still, bullish support prevail in the daily USD chart, as indicated by this currency's continued buoyancy over its 5,9,21-EMAs, which have remained positively lined-up.

Technical hurdles ahead are:
1 - RSI's inability to cross over its 60-line. This alone is a very bearish sign of weakness, as it continues to indicate the market's inability to shore up more buyers;
2 - 90-EMA overhead resistance;
3 - Strong pre-decline pattern
4 - ADX's D(-)/(+) lines favoring a renewed strengthening of a bearish strenth, especially at the current D(-) level combined with ADX's rise. This particular rise would indicate a gain in a new or renewed strength in trend. If D(-) rises with ADX, then make that a renewed bearish strength.

OVERALL, leading and combination of indicators are favoring a bearish strength, unless the first three hurdles are negated, IMHO.

XAU
NOTE: As a corollary to above view, consider that gold (XAU) walk in inverse, but lock-step fashion with the USD. So, the bearish inkling that I alluded to above can also be viewed from the point of view of XAU, which at the onset of this week's open as gained a significant technical "traction" at the current support line.

Technically, XAU's weekly 14-RSI remains extremely bullish, keeping itself above its 50-line as well as its 45-EMA. At the same time, price touched and closed above a significant support line, while CCI and Wm%R have remained similarly in bullish territory. Whether this bullish pattern is likely to hold over the rest of this and other weeks ahead is unsure, as ADX has since dwelled within a non-trending range.


EUR
The EUR daily chart remains bullish, as the price closed at a significant support level. While RSI broke down steeply, it still remained optimistic within its 80-40 bullish range. A test below the 35-level would likely spell further weakness ahead, though. For now, secondary indicators are favoring a rally, whose significance against the dollar will decide whether the pair will continue to fall or rise.


EUR vs. USD:
Finally, XEU:USD chart indicates an interim break-down within the intermediate bullish channel, wherein it fell down into its lower half. Correspondingly, price closed and remained above its 90-EMA while all other indicators have maintained a bullish bullish. Here, we find similar patterns as in the XEU daily chart, to suggest that whatever strength the USD is gaining has not been significant enough to distort the lone XEU chart from its relative strength against the USD. I believe that this in itself suggests that the USD has not gained the momental strength needed to reverse the predominant rally seen over the past weeks between the pair, IMHO.

For now, let's sit back and enjoy the thinning of the year.

Happy trading to all, my friends.


USD - 12-Month, Daily Chart:



XAU - 36-Month, Weekly Chart:



EUR - 12-Month, Daily Chart:



EUR vs. USD - 12-Month, Daily Chart:


- Dalcindo