TriumphFX Forex Analysis – USD Pairs – June & July 2020

AUDUSD – Daily and 4 Hour Charts

AUDUSD has been bullish. Price has not been able to break recent swing highs though, suggesting that the AUDUSD could still downtrend or could become indecisive. The daily moving averages confirm the market indecision – they are tight and moving sideways.

On the 4 hour time-frame, price is clearly up-trending and has formed a bullish channel. The AUDUSD is currently finding resistance around the channel resistance area.

Opportunities to go long may exist around the bullish channel support area, around the 4 hour and daily moving averages. A bearish move could find support around the horizontal levels at 0.6660, 0.6560, 0.6370, 0.6265 and 0.5740. A bullish move could find resistance around 0.7015 and 0.7070.

The Federal Reserve has announced a record breaking stimulus package, aimed at US households and employers. The US Federal Open Market Committee (FOMC) has unexpectedly cut rates by 150 points due to heightened concerns regarding the COVID-19 outbreak. The current Fed Funds rate is currently 0.25%, back at post-2008 levels. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. The USD has been acting as a safe haven amid the COVID-19 outbreak. There are some concerns that the COVID-19 pandemic may hit the US hardest, causing a reversal of the recent USD strength.

The Reserve Bank of Australia (RBA) cut rates again in their April 2020 meeting. Rates were cut by a further 0.25%, bringing the official bank rate to 0.25% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate the economy due to COVID-19 recession fears. The RBA will continue to monitor the labour market and inflation. Rates will not be raised until targets are met.

EURUSD – Daily and 4 Hour Charts

As suggested in our last USD chart analysis, the EURUSD was finding support around 1.0785 and is currently finding resistance around 1.1400.

Just like other EUR pairs, the EURUSD is indecisive and lacking trend momentum. Price is ranging on the daily chart between the lows at 1.0650 and the horizontal resistance at 1.1400. The moving averages confirm the market indecision – they are tight and moving sideways.

Price has been up-trending on the 4 hour time-frame. The moving averages are bullish and widening, suggesting that the upside direction may continue.

Trading opportunities could exist around the support and resistance areas of the range and if EURUSD moves out of the range (break-out trade). Buying opportunities could exist around the daily and 4 hourly moving averages and around the horizontal levels at 1.1135 and 1.0990.

The European Central Bank (ECB) continue to keep rates at the record low of 0.00%. Rates have not been cut into negative territory, despite the COVID-19 outbreak. Instead, the ECB has launched an asset buying program. Due to weak trade growth and economic forecasts, rates are likely to stay low for the foreseeable future. The COVID-19 pandemic is just another economic challenge for the Euro zone.

GBPUSD – Daily and 4 Hour Charts

Price has reversed around the daily trend resistance area and the longer-term moving average (as suggested in our last USD technical analysis).

GBPUSD has been down-trending but price action has formed a short series of higher swing highs and higher swing lows on the daily chart, suggesting that downside momentum could be weakening. The moving averages have been crossing frequently and are moving sideways, signalling market indecision.

Price has been bullish on the 4 hour time-frame. The moving averages signal market indecision on the 4 hour also – they are moving sideways and have been crossing frequently.

Trading opportunities may exist around the moving averages, around the diagonal resistance area and around the horizontal levels at 1.1490, 1.2015, 1.2080, 1.3205, 1.3250 and 1.3465.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

USDCAD – Daily and 4 Hour Charts

The USDCAD has formed a clear swing higher (March 2020) and has since been in a retrace phase.

Price has moved below both daily moving averages and the moving averages are tightening, all suggesting that the USDCAD may become indecisive.

Price has been bearish on the 4 hour time-frame. The moving averages suggest that the downside momentum may continue.

Trading opportunities could exist around the daily and 4 hourly moving averages and around the horizontal levels at 1.2960, 1.3345, 1.3865, 1.4190 and 1.4495.

The Bank of Canada (BOC) followed the US by slashing it’s benchmark interest rate. The intent of the rate cut is to help boost the economy during the COVID-19 pandemic. The current rate is now 0.25%. The economy is currently performing well and inflation targets are currently at their potential. If coronavirus fears deescalate, the BOC could increase rates again in the near future.

USDCHF – Daily and 4 Hour Charts

As suggested in our last USD chart analysis, the USDCHF has continued to be choppy.

Price has also been bearish though and continues to move within a large daily bearish channel. The daily moving averages are bearish and steady, signalling that the downside direction may continue.

On the 4 hour time-frame, price has also been bearish and is down-trending. The moving averages are bearish and widening, suggesting that the downside momentum may continue.

Opportunities to go short could exist around the 4 hour and daily moving averages, around the 4 hour trend resistance area, around the daily bearish channel resistance and around the identified horizontal levels at 0.9595, 0.9645, 0.9785, 0.9885 and 1.0005. An attempt to swing lower may find support around the recent lows at 0.9275 and around the daily bearish channel support area.

The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant. The economy was showing signs of positive momentum but COVID-19 is causing the economic to contraction. The Swiss Franc continues to be highly valued as a safe-haven currency. The SNB recently announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.

USDJPY – Daily and 4 Hour Charts

The USDJPY is choppy and moving sideways (as suggested in our last USD analysis).

Price is clearly indecisive and lacking trend direction on the daily time-frame. The daily moving averages confirm the market indecision – they have been crossing frequently and are moving sideways.

USDJPY is also looking indecisive on the 4 hour time-frame. Once again, the moving averages are moving sideways and have been crossing frequently – confirming the market indecision.

Trading opportunities may exist around any of the identified horizontal levels at 103.05, 104.85, 106.20, 109.60, 111.30 and 111.95.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

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