DOLLAR - On its way to the December 2023 high
EURUSD - 200 dma support likely to be taken out
USDJPY - YEN weaker than expected
GBPUSD - Stable
EURGBP - Very bearish moving averages set-up
XBTUSD - Significant high likely in
Following six sessions of congestion, the DXY took the expected route North by braking above the early January high yesterday. While we maintain our target @ 104.6 (December high), the dollar might churn sideways for a few sessions as it is trading on both 200 & 55 dma resistances.
The Euro just broke below the Jan 5th pivot low and is on its way to the December 2023 low @ 1.0724. However, the 200dma, currently a few pips below the session low, might support the market for a few sessions before a resumption of the downtrend.
Last week, we expected USDJPY to peak near 148, but the market arrived at the mentioned level faster than expected, and the dollar still appears to have some steam left. Currently on the 2023 major support (turned resistance), we expect a retracement of 100-150 pips max, before a resumption of the uptrend, targeting the November pivot high just under 150.
GBPUSD is still trading within a tight range, near the 1.260 support and 55dma. The cross could bounce moderately towards 1.270 in the short term, but expect a final down leg towards 1.255 – 1.250 before GBP is ready to push towards the 2023 high @ 1.314
The main moving averages are both converging and pointing down, which is a highly bearish recipe. The current break of the 0.86 support, if confirmed, could accelerate the depreciation of the Euro, taking the pair to the 0.85 support rapidly.
Last week, XBT spiked to $49k, at the top of both the long term and medium-term trend channels and has since reversed impulsively. We believe a significant high is in and that XBT will correct for several months, targeting $35k.
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