On the daily chart below, we can
see that the long period of choppiness since the March banking crisis seems to
be ending. After a brief spike to the 0.6389 resistance caused by the bigger than
expected RBNZ hike, the market turned lower, and the price started to make
lower lows as the US data began to miss expectations causing recessionary
vibes.
The latest big move lower started
when the US
Retail Sales missed expectations across the board sending the
US Dollar higher as a safe haven. Yesterday we also had a big risk off day
probably caused by fears around the FRC bank and another banking crisis. The
market is now eyeing the March low at 0.6084.
On the 4 hour chart below, we can
see more closely the ugly price action since March with the price basically
ranging between 0.6170 and 0.6280. With this new trend lower we now have the
major trendline that will act as resistance for
the sellers in case the price bounces from the March low and pulls all the way
back there.
At the moment the price is
trading within a channel with the sellers targeting the March low. The buyers
are likely to lean on that support to then target the top of the channel and
ultimately the trendline.
On the 1 hour chart below, we can
see there’s another trendline within the channel that defines the current
bearish momentum. If the price breaks above it, then we may see a rally towards
the top of the channel with the sellers waiting there. Otherwise, the price may
reject this trendline and fall towards the March low.
Tomorrow, we have the US Jobless Claims, and they were giving market
moving opportunities lately. Another miss should send the market lower, while a
beat may give the buyers enough strength to push the price towards the major
trendline.