USD, EUR/USD, GBP/USD, USD/JPY and USD/CAD Highlights:
- USD is forming an ascending triangle pattern, which usually means a bullish outlook
- EUR/USD potential breakout, GBP/USD eyeing support gains and losses, USD/JPY testing key resistance
USD is currently at risk of a bullish breakout, which seems to be expected given the news of last week's Fed decision. The Fed said it is likely to speed up the pace of interest rate hikes, while strongly signaling that it is ready to announce a reduction in asset purchases. Federal Reserve Chairman Jerome Powell has indicated that if the next jobs report is not disastrous, the decision may be announced at a meeting on interest rates in November.
Dollar analysis: bullish breakout imminent
With the September non-farm payrolls due out next Friday, October 1st, September's data will have an important impact on the market. But the dollar's price action is primed for a breakout, and for the past few months, the greenback has been constructing an ascending triangle pattern, which is usually a bullish breakout pattern.
USD Index Daily
This pattern is characterized by horizontal resistance lines and support lines connected by rising lows. This resistance line for the dollar comes from this year's high of 93.43-93.73, which is also the high after the Fed's decision and the high in the first quarter.
EUR/USD analysis: potential breakout
If the dollar is to break 2021 resistance,At least some support from the euro will be needed, and the EUR/USD pair is currently trading near the same support level it was a few weeks ago.
EUR/USD daily chart
EUR/USD has been mostly range-bound for most of the year, only breaking below 1.1700 on a few occasions. The low so far this year is 1.1664. If it falls below this level, it may open the door to further downside. The lower support looks at the 1.1448-1.1500 range. The former is the 50% Fibonacci level and the latter is an important psychological level.
GBP/USD trend analysis: focus on gains and losses at support levels
For those traders looking for resistance above the dollar, GBP/USD may be a good choice. The Bank of England's interest rate decision last week showed that the Bank of England may raise interest rates faster than the Fed, and the market currently expects the Bank of England to raise interest rates by 15 basis points in the first quarter of next year.
GBP/USD daily chart
GBP/USD made a seven-month low of 1.3575 in July, followed by higher lows in both August and September It is very important to be able to hold the support trend line connecting these higher lows. In addition, the former support range of 1.3650-1.3678 is now just above this trendline.
USD/JPY analysis: testing key resistance levels
If the dollar can continue to strengthen in the fourth quarter, there is no doubt that the Fed laid the groundwork last week for future rate hikes. That could be a repeat of roughly the first quarter, when markets on economic recovery hopes tried to get ahead of the Fed,And the Fed only started to have real intentions last week and raised its rate forecast.
USD/JPY weekly chart
USD/JPY rose for 3 days after the Fed rate decision, and is about to test the key resistance range of 111.61 (Fibonacci) - 112.50 (coming to the important psychological barrier). This range has acted as a key resistance range since 2019. If the short-term resistance level of 110.97 can be broken above, it is expected to test this range. If the bulls break through 112.50 in one fell swoop, it means that USD/JPY will refresh a two-and-a-half-year high. 114 Open the door.
USD/CAD trend analysis: still testing support
USD/CAD rebounded from the support range last week and came to this range again, the long-term support range focuses on 1.2500-1.2632, and the short-term support range focuses on 1.2621- 1.2632.
USD/CAD 4-hour chart
USD/CAD bounced off short-term support this week, opening the door for further upside for the bulls. USD/CAD, possibly mean reversion at the moment, as the pair has been range-bound in September with resistance around 1.2695 and 1.2762.
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