EURUSD, AUDUSD and NZDUSD print new 52-week highs, USDCAD new 52-week low to mark their strengthening against USD; terminates previous year-year trend.
Major pairs strengthening against USD
|New 52-week high||New 52-week low|
52-week high/low is an important psychological level. By printing a new 52-week high/low, these pairs have terminated their previous year-year trend. We are looking at reversal signals. They are strengthening against the USD and the JPY.
The 52-week high is explained here in further detail.
DXY action and policy direction diverge
It is interesting to note that while the FOMC continues to promise rate hikes and ‘quantitative tightening’ or balance sheet normalisation relatively soon, DXY is moving in a totally diverging manner.
- XAUUSD also printed new 52-week high last year that terminated 2013 – 2015 down trend. New 52-week high does not mean price will shoot to the moon. XAUUSD is now the perfect illustration for learning purpose. Price will continue to move in zigzag manner but unless new highs is totally reversed by new low, price will take some time to consolidate, print a larger reversal pattern before taking off.
- I still expect some kind of belated action to take place possibly a throwback, see here and here.
- Not coincidentally, one should ask why USDSGD is printing right now in this chart. USD bears will probably see a bearish reversal being formed – then all the signals above from EUR, AUD, NZD and CAD will fall into place nicely while USD bulls will continue to insist that USD is merely oversold. Participate in poll here to indicate whether you are in bull or bear camp on this one.
- AUDJPY, NZDJPY and CADJPY also printed new 52-week high.
Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.
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