USDollar Weekly Forecast 14 Nov – 18 Nov

Summary
In my review on Saturday I mentioned the resistance at MM3 on Dxy, the support trend line on the US 10Y and the resistance trend line on the Nikkei. I expected some retracement before breaking those levels though the market continued without even taking a breath. Dollar was strong from Asia through London and continues to move up during New York. The next major level for Dxy is MR1 marking the highest the USDollar has been at since the early 1990’s. As mentioned in my review news to look out for this week is retail sales and CPI. We also have a number of FOMC members speaking including a testimony from Yellen later in the week. Unless the data is poor or we see very dovish rhetoric out of the FOMC, USDollar bullishness should continue.

Dxy H4

WM4 marks the top of the resistance zone highlighted in red. This resistance marks the highest level Dxy has been at since the early 1990's. Price has broken through WR1 so if price respects resistance above WR1 then WR1 would play as role reversal support. Price has not come off a bull pivot point so a target is not clearly visible though MM4 or MR2 is likely unless for some fundamental reason USDollar gets weak.

AUSUSD H4

Price opened just above WM2 though has failed to break resistance at MM2. The trend line drawn from Aug '16, Sep '16 and Oct '16 lows that was providing support will be tested in the future and I eye the trend line crossing the WPP and MPP just above 0.76 where I will look to sell should price break resistance at MM2. That will give bears a target of WS2.

NZDUSD H4

Price opened just above WM2, broke through WM2 and is currently at MM2. The support trend line drawn from Jan '16, Aug '16 and Oct '16 lows will be tested in the future and resistance is eyed at in the red zone at WM2 with a target of WM1/ WS2. Support is eyed just above WS1, highlighted in green in the above chart.

EURUSD H4

Price opened at WM2, broke through WM2 and is currently at MM1. Resistance is eyed at WM2/ 1.0850 with a target of WM1/ WS2 should USDollar remain strong.

GBPUSD H4

Price opened between WM3 and WPP. Support at 1.25 did not hold as expected for bulls though price did respect the 55 EMA and failed to close below the bullish trend line drawn from Oct '16 and Nov '16 lows. Price is currently just above WM2. I am waiting for a break of the bullish trend line and pull back to WM2 before going short because until then trend is bullish. Bear target is WM1/ WS2. Note that the resistance zone marking the bottom of the post-Brexit range coincides with WM4, the current target should bulls buy at WM2.

USDJPY H4

Price opened at 106.500 and smashed through 107 and 108 today. Price is currently at 108.500 with WR1 above. Besides psych levels, support is eyed at the green zone at WM3. The bull target for the week is 110 should USDollar remain strong.