The USD index is looking like touching a near-term top supported by an overbought RSI, says Walter Zimmermann at United-ICAP. The index is now close to the 81.80 region, a major target area and the short-term RSI is showing bearish divergence at extreme levels.
USD/JPY has seen a significant break out of a trading range bounded by its 20 and 50 week moving averages, say analysts at ADS Securities. However, momentum has declined suggesting a lack of conviction for further gains. A move back below 101.80 would signal the start of a downward trend.
GBP/USD faces significant resistance from a 42-year trendline and the possibility of a major correction, says Chris Wiliams at Soc Gen. The trendline that began in March 1972 has recently been touched by 1.7091 and GBP could now face a reversal with a possible target of 1.582 going into Q4.
Bollinger Band analysis for the S&P500 shows the spread between the upper and lower bands has now increased to 639 points, the highest level in 14 years, says Peter Lee at UBS. Although there is no other evidence for a top, the index is susceptible to a sharp downwards correction. Read also his FX, commodities and bond analysis.