Risk-on tone elevated somewhat overnight with US equities and US 10 Yields edge lower. Macros side better than expected Europe PMIs and weaker than expected US durable goods order hits the screen on Wednesday.
Besides, lots of Head & Shoulder (bearish) patterns spotted on the daily and four-hour charts across the board. Technical bearish trends emerge at the back of month-end and quarter-end we believe. With only five trading sessions to quarter-end, repositioning portfolios taking the driver’s seat. From recent peaks and lows, the G10 currencies fell between 2-7.00% against the dollar.
Here’s the table…
On the daily candlestick chart, We have spotted a golden crossover on the USDJPY daily chart and USDCHF should follow soon. Flipside EURUSD lost the 200MA and 1.1700 and 1.1600 are the next possible destinations.
Technical analysis: H&S patterns:
In the technical analysis world, the H&S pattern is a predictable chart formation that suggests a bearish pattern from the peak or sentiment shifting from bullish to bearish. As shown on the below chart, there are three components. They are 1. Head, 2. Shoulders 3. Neckline. A move below the neckline means it is drifting towards lower.
Among G10 currencies the kiwi dollar started the bearish H&S pattern trend and AUDUSD following that. We forecast a bearish target on the NZDUSD. Please see below:
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CandlesticksElsewhere, Silver in precious metal space and Litecoin in Crypto space developed H&S patterns on the H1 and H4 charts respectively. Here are the charts.
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Double top pattern: Another bearish chart pattern. Please read our Brent analysis for an illustration.
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