By David Ruscelli
FOREX TECHNICAL ANALYSIS
Welcome to our usual session of forex financial markets analysis to trade in foreign currencies.
Today we are seeing an interesting movement that perhaps could indicate a temporary setback for the U.S. dollar. There is a very obvious shooting star pattern right at the top of our uptrend, perhaps; could this mean the end of the rally?
I would like to remind everyone that this financial tool, called U.S. DOLLAR INDEX, represents the strength of the U.S. dollar against the main currencies, so it is very useful to make a note of it since it can offer insights and confirm by correlation.
USDOLLAR INDEX D1
As a correlation we have a similar (but opposite) movement on the aussie, the Australian dollar quoted in U.S. dollars. In this case we have a signal indicating the stop of the descent, a nice pin bar, identifiable also as a hammer. A Japanese column which foresees a stop and a reversing of trend of the financial instrument, in this case a forex pair that contains it. We are also right above a very important milestone, U.S. $ 1.0150 to buy one Australian $, over a possible target of 1.0359. Tomorrow, the central bank of Australia will decide the overnight interest rate, this decision will affect the volatility of the pair and if it will go up or down, but the forecast is for a rate remaining at 3% so it should not generate any kind of sell-off.
Our operational analysis forex for today ends here. Good trading to all!