Recent fundamentals have led to a significant strengthening of the US dollar. As a result, most major FX pairs have been impacted by this turn of events. While some pairs are experiencing trend reversals, others have seen a notable boost, setting the stage for the sessions ahead.
EUR/USD: Bearish
The EUR/USD has experienced a notable reversal from its previous upward trajectory. This major FX pair had been on an upward path for an extended period. However, at present, bearish traders seem to be combining forces with the changing fundamentals, causing the pair to retreat more rapidly.
The closing session for the week continues to indicate that downward momentum is still in play, as the last price candle pushed against the lower limit of the Bollinger Bands (BB). Meanwhile, the Stochastic Relative Strength Index (Stochastic RSI) has fallen deep into the oversold region. The leading line of the indicator is now bending sideways at the 0.00 level, and it appears it may remain there. As a result, the market may only advance toward the 1.0900 threshold.
GBP/USD: Bearish
The GBP/USD market shows similarities to the EUR/USD pair. Price action for this major FX pair has also fallen below the middle limit of the BB indicator. The closing session for this pair appears to have been under substantial pressure, leading to significant contractions.
Nonetheless, price activity remains below the middle limit of the BB, indicating vulnerability. Furthermore, the Stochastic RSI has reached the oversold region’s peak, but no upward crossover has occurred. Consequently, this suggests that price action may continue toward the support at the 1.3050 price level.
USD/CHF: Bullish
The momentum gained has brought renewed hope to the USD/CHF market. This occurred after the pair had been under sustained bearish pressure, which had pushed price action lower. However, the pair’s price has now advanced quickly off the support at the 0.8400 threshold.
The closing session for the week shows price action pushing through both the middle and upper limits of the BB indicator. Additionally, the Stochastic RSI lines are still rising steeply, with the leading lines already touching the 100 mark of the indicator. Traders can anticipate further upward retracement, potentially reaching the 0.8600 price level.
USD/CAD: Bullish
The USD/CAD market has seen a considerable level of recovery as price action bounced off the support at the 1.3444 price level. Since then, price action has continued to move upward. The closing session for the week indicates that the market may have found a promising support level, as the last price candle sits above the middle limit of the BB indicator.
The final price candle also appears to be testing the resistance at 1.3595. Meanwhile, the Stochastic RSI lines are still rising, with the indicator lines now testing the 80 level. This suggests that the market may advance toward the 1.3650 mark.
AUD/USD: Bearish
This major FX pair has reversed from its recent annual high due to the strengthening momentum of the US dollar. The AUD/USD pair was approaching the 0.6950 threshold when headwinds and bearish traders took control. Consequently, prices have been retracing to lower support levels.
The current session has made the market more susceptible to further declines, as it has breached the support at the middle limit of the BB indicator. Additionally, the Stochastic RSI lines are trending lower, signaling that the market may fall further. Traders can aim for support at the 0.6750 price level.
EUR/JPY: Bullish
The EUR/JPY market has been indirectly impacted by the strengthening of the US dollar. As a result, the price action of this major FX pair has seen a significant upward retracement throughout the week. Moreover, the closing session has just broken through the resistance at the 162.00 threshold.
At the same time, the Stochastic RSI lines have entered the overbought region. The behavior of the indicator lines suggests that bullish momentum may remain viable for a while longer, allowing the market to gather gains toward the 164.00 and 165.
USD/JPY: Bullish
The USD/JPY pair has been more directly impacted by the strengthening of the dollar. The price action of this major FX pair has recovered significantly from its most recent price dip, which caused the market to drop below the middle limit of the Bollinger Bands (BB) indicator.
This major FX pair closed the week’s trading activity above the 148.00 price level, which is above the upper limit of the BB indicator. Additionally, the Stochastic RSI lines are now in the overbought region while maintaining an upward trajectory. This sets the tone for the opening hours of the new week, suggesting that traders may target the 149.00 and 150.00 thresholds during the initial trading sessions.
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