What’s in store for the US dollar after the midterms?
The US Dollar Index has weakened slightly in the wake of the US midterms. What can we expect from here?
For USD/CAD the best support today is probably at 1.3075/70. However, a move below 1.3050 would risk a slide to 1.3035 and 1.3015/10, before strong support at 1.2955/45. Long positions need stops below 1.2915.
Holding above 1.3120 re-targets 1.3150/60. Above 1.3175 look for 1.3200/05 and the September high at 1.3220/25.
AUD/USD meets a selling opportunity at 7265/75 this week, with stops above 7300. A break higher is a buy signal and a move above the September high of 7315 targets 7333/35 then minor resistance at 7346/50. On further gains look for 7360/63 and 7378/82.
Failure to beat the only resistance of importance today at 7265/75 targets 7240 and 7220/15 before support at 7180/70 for profit-taking on any shorts. A break below 7155, however, risks a slide to 7125/20.
If NZD/USD holds above 6710/00 we target 6760 and 6790/99. On further gains look for 6730/35 and some resistance at 6750/60.
Holding below 6690 risks a slide to good support at 6660/50 and the best chance of a low for the day. Any long positions, however, need stops below 6625.
USD/JPY has key support at 113.00/122.90 but long positions need stops below 112.75. Below here we risk a slide to minor support at 112.60/55 and 112.20/10.
Holding above 113.40 signals further gains this week to minor resistance at 113.55/60 and 113.90/95. A move above 114.10 targets the October high at 114.50/55.
The EUR/USD outlook is more positive if we hold above 1.1420/25, with only minor resistance at 1.1450/60. Strong resistance at 1.1500/10 is certainly more of a challenge. Further strong resistance at 115.30/40 could see a high for the day if tested.
The first support is at 1.1420/25 but a move below 1.1400 is less positive, targeting 1.1375/70 then 1.1345/40 before important support at 1.1310/00. But this is much less likely to hold another test.
GBP/USD is making a break above 1.3120/30 to target 1.3180/90. On further gains look for 1.3235 and the October high at 1.3255/58, then the September high at 1.3290/97.
Holding below 1.3100, however, risks a slide to 1.3065/55. A fall below 1.3035 would meet very minor support at 1.3000/1.2990.
Technical Analyst & Trader
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