Forex Review for November 4th

Σε κρίσιμο σταυροδρόμι η αγορά….
November 3, 2016
Τραπεζικός κλάδος…οδηγώντας τη νύχτα δίχως φώτα.
November 4, 2016

Good morning to all, you all have read my analysis of the last few days where I was warning Dollar bulls that a reversal was coming when the Dollar index was around 99. The reversal is here and I believe we have a lot of chances that the last high in the Dollar index above 99 will be a long-term high of high importance.


However in the short-term the Dollar has become oversold and in several pairs we see price has stopped at important resistance levels (AUDUSD, NZDUSD,EURUSD) and therefore we might see a couple of days of Dollar strength specially if the NFP numbers today help push prices towards that direction.


EURUSD has reached the Ichimoku cloud from below and is testing resistance. I believe a major low is in for this pair and that a short-term top is in or the pair is about to complete the first part of the rise from 1.0850 near 1.1150. I now expect a reversal towards 1.10-1.0950 and then more upside.


GBPUSD has broken the consolidation range to the upside and is testing 1.2530 resistance. Next resistance comes at 1.30 but in the short-term overbought divergence signs might need to be relieved with a pull back towards 1.2350.


USDJPY is also showing signs of an upward reversal. As long as price is above 102.80 I will expect a bounce towards  103.80-104.30. Overall I believe an important high at 105.53 is in and that a new trend downwards  has started. Key for this scenario is the 105.53 level.


USDCAD is trading above 1.34 despite Oil tanking below 45$. Important support is found at 1.3350 and with several bearish divergence signals. Bulls need to be very cautious at current levels and raise their stops.


AUDUSD remains inside the triangle pattern and just below the upper triangle boundary. There are bearish reversal signs from the oscillators and it would be wise to remain neutral or bearish as long as price is below 0.7720.


NZDUSD has reached the upper cloud boundary resistance. There is a big fight happening there right now as this is a critical juncture for the kiwi. There are no divergence signals but a pull back towards 0.7220-0.7180 could be justified without hurting the bullish medium-term trend. 0.7150 remains critical long-term support that if broken will open the way for a push towards 0.69.

Overall I believe Dollar bulls at current levels have more chances of success and profits than opening now short Dollar positions. I believe the Dollar should bounce from current levels and I prefer to stay neutral currencies until next week’s US elections.

Have a nice day and a better weekend….stay safe

Alexandros Yfantis
Alexandros Yfantis
Fascinated by financial markets, studied International Securities Investment and Banking in the UK, works as a Portfolio Manager in Greece and runs a technical analysis website. Enjoys travelling and spending time with his family and preparing for the black belt in Korean Karate.