USD : Price Action

(Tue, 16 Feb 2021). As mentioned in previous report, the haven-associated US Dollar may continue to lose ground against its major counterparts, as long-term price analysis suggests a cyclical downturn is in the offing.

AUD/USD WEEKLY CHART – GOLDEN CROSS HINTS AT EXTENDED GAINS

The longer-term technical outlook for AUD/USD remains overtly bullish, as price surges above the August 2020 high (0.7413) to challenge the psychologically imposing 0.7800 mark. With the MACD hovering at its highest levels since 2011, and the RSI eyeing a push into overbought territory, the path of least resistance seems higher. A bullish ‘golden cross’ moving average formation also hints at extended gains for the exchange rate in the coming months. A weekly close above 0.7810 is required to signal the resumption of the primary uptrend and clear a path for price to challenge the 2018 high (0.8136). Hurdling that likely brings the 100% Fibonacci (0.8918) into the crosshairs. However, if 0.7800 successfully stifles buying pressure, a short-term pullback to the yearly low (0.7564) could be on the cards.

NZD/USD WEEKLY CHART – RSI INDICATIVE OF SWELLING BULLISH MOMENTUM

NZD/USD rates also seem poised to continue pushing higher, as price storms away from the support range at 0.7100 – 0.7130. The development of the RSI hints at swelling bullish momentum, as the oscillator continues to track the uptrend extending from the March lows and eyes an entry into overbought territory. A weekly close above 0.7250 likely paves the way for buyers to drive the exchange rate towards the 61.8% Fibonacci (0.7333). Breaching that opens to door for a challenge of the 2017 high (0.7558). Conversely, failing to break above the psychologically imposing 0.7300 mark could allow sellers to force NZD/USD back towards the yearly low (0.7096).

USD/CAD WEEKLY CHART – DESCENDING CHANNEL GUIDING PRICE LOWER

USD/CAD looks set to extend recent losses, as price continues to track within the confines of a Descending Channel. A ‘death cross’ moving average formation, in combination with the RSI dipping to its lowest levels since 2017, suggests the path of least resistance is lower. Piercing range support at 1.2555 – 1.2590 likely intensifies selling pressure and clears a path for price to challenge the 2018 low (1.2247). However, if support remains intact, a rebound back towards channel resistance and the 21-EMA could be in the offing (1.2599).

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