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US Dollar Price Action Determination: EUR/USD, GBP/USD, AUD/USD, USD/JPY – By ASC


US Dollar Discussion Items:

The US dollar has hit another high every year, and this time it was not funded largely by the decline in the Japanese Yen. The latest iteration has resulted in both the Euro and the British Pound continuing to sell, albeit at varying levels of momentum.

In the US Dollar, the currency is trading above the 102.00 figure in DXY for the first time since March 2020. This also marks the entry into the long -term resistance zone that I have started around 101.80. This is a resistance zone with some long -term consequences that help maintain the highest level in the Greenback for almost 20 years now.

But, from the weekly below, we can see the US Dollar working on its fourth consecutive week of gains, through the entire early trade of the second quarter. We maintain the forecast as a price increase for the USD this quarter, seeking relocation to this long -term zone. If you want the full forecast, you can access it from the link below.

US Dollar Weekly Price Chart

Charts provided by James Stanley; USD, DXY on Tradingview

Taking a step back to the Monthly chart and we can see the current bar in the US Dollar has forced a huge spike. You will also find that previous iterations in this zone have been quickly filled with reversals, as shown by the upper axis on those episodes from 2016/2017 and again in 2020.

The run, however, saw no softness as buyers continued to insist. And counterparts appear to be helping with the decline of the Euro and GBP even as the Yen begins to strengthen, with the USD soaring throughout the development of all those themes. This also provides a very interesting backdrop as we move deeper into Q2 trading. On the other hand this resistance zone is a new 20 -year high in USD.

US Dollar Monthly Price Chart

US Dollar Monthly Price Chart

Charts provided by James Stanley; USD, DXY at Tradingview

EUR/USD New Two -Year Low

EUR/USD has already set a new two -year low and there is another bearish path point on the chart, and that is Covid’s lowest level from March 2020, plotted at 1.0636. Yesterday saw the 1.0700 level released and that was followed by a pullback to the resistance at the early support early this morning before another extension of the bearish movement.

This downward movement in EUR/USD has been a major component of the ongoing breakout in the US Dollar as the Euro plays a major role in the composition of DXY quotes.

The bigger challenge here is continuity. As seen last week, prices are crawling to new lows while in large support zones are a weak point and this could reveal a potential pullback. Last week’s pullback was shallow, hitting resistance at 1.0931 as I had seen before the movement.

A similar type of theme is likely to develop in EUR/USD when we close at that low of 1.0636. On the four-hour chart below I have added some possible spots for low-high resistance potential in blue.

EUR/USD Four Hour Price Chart

four -hour price chart eurusd

Charts provided by James Stanley; EURUSD on Tradingview

GBP/USD Crushed After Breaking The Descending Triangle

On the long side of the US Dollar, GBP/USD has helped with the recent breakout. I saw the pair last week as it holds 1.3000 psychological level. There have been some tests at that stage but nothing has given way.

The breakout hit here last Thursday and the price has yet to really stop moving — even lower and the movement has covered more than 350 pips in the breakout. The next clear support potential is down around the psychological level of 1.2500, and that collides with 61.8% Fibonacci retracement of key measures 2020-2021.

GBP/USD Daily Price Chart

gbpusd daily price chart

Charts provided by James Stanley; GBPUSD on Tradingview

Aussie Bears on Attack

Also helping to drive the upward movement in the USD is the bearish return to AUD/USD. Throughout March and into early April AUD/USD remained strong despite the US Dollar surging higher. But, as seen in this week’s forecast, the tide has changed over the past two weeks and sellers are back on the go.

Already this week prices have fallen to new lows in two months while gaining little support at that level; but the big .7000 figure looks vulnerable here as prices have fallen aggressively since their highs earlier in the month.

AUD/USD Daily Price Chart

audusd price chart

Charts provided by James Stanley; AUDUSD on Tradingview

USD/JPY Begins to Retreat

USD/JPY has been in full launch mode since early March with a soaring flow of more than 1500 pips. And there was little pullback in the movement, except for one episode in late March.

But when the price in USD/JPY approached the key psychological level at 130.00, things started to change, and now the price has breached the price increase. trendline while setting low-low.

This gives the emergence of greater pullback potential, with a focus on possible support around 126.55 after which the major zone or previous resistance begins to play. The zone was pulled from the monthly chart at a 20 -year high and ranged from 124.15 to 125.86.

The psychological level at 125.00 remains interesting, too, as this is the previous resistance point that led to the pullback movement.

USD/JPY Four Hour Price Chart

USDJPY four -hour price chart

Charts provided by James Stanley; USDJPY on Tradingview

— Written by James Stanley, Senior Strategy Specialist for DailyFX.com

Call and follow James on Twitter: @JStanleyFX

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