The relationship between USD/JPY and gold is one of the most interesting intermarket stories around, according to George Davis, Chief FIC Technical Analyst at RBC Capital Markets. He points out that this correlation is now at its most negative since 2008.
The US dollar is set for long-term gains. This is the view of Martin Jones at Informa Global Markets who uses, amongst other techniques, MACD signals and fibonnacci level to analyse the USD index.
EUR/USD is now testing the March 2013 lows and should decline further targeting 1.20 in Q4, say analysts at 4CAST. Meanwhile, USD/JPY is expected to rally further into Q4 after completing a prolonged consolidation phase.
A possible reversal on the weekly chart needs to break above key resistance at 1.6275-1.6300 to confirm the move upwards, say analysts at ADS Securities.
After bouncing off its 42 year trend line at 1.7091, GBP/USD has is set to correct back to 1.582 in Q4 which may provide a good buying opportunity, says Chris Williams at Soc Gen. This should be supported by a significant RSI reading signalling oversold conditions in the cross.
The completion of a head-and-shoulders reversal pattern in EUR/GBP paves the way for a maximum multi-week target of 81.98/99, says Steve Jarvis at Tradermade. However, such a reversal will remain within the Aug 13 – Mar 14 bear channel meaning underling weakness remains.
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.
Ichimoku (cloud) chart analysis shows the US dollar index continuing to gain strength following the low touched at the beginning of July, says David Linton at Updata. Gains against the euro and GBP should be expected although for Cable, a move below 1.6730 is needed for the longer-term rally to end.