Majors at pace with the USD

In our Market View report dated the April 12 calling a corrective mode for the USD or the US dollar index to move towards the 79.20 - 80.00 important support came true to our expectations and that the correction would occur starting the 7th of April towards the second week of April. Supported by the widening trade gap report which led the USDX to open lower at the 80.55 basis point close enough to the 1st support price.

The opening Asian prices that opened with a gap for most majors like the EURUSD and the GBPUSD has corrected and filled in that gap from the previous days trading range in keeping pace with the US dollar's correction. Opening at 1.3625 from the closing of 1.3495 for the EURUSD and 1.5445 opening for the GBPUSD from a 1.5375 closing respectively. Currently, its back to the previous prices of Monday's opening at 1.3640 EURUSD and 1.5508 GBPUSD after the correction. Although, the EURUSD is still lagging behind filling in the gap a second attempt should not be discounted as risk appetite may run out for the Euro and simply move lower.

The significant indicator showing this was mainly reflected with the AUDUSD from 0.9360 down to it correction low of 0.9220 ; a 0.0140 range and is currently back to the 0.9340. the price and area index adjustments has been made and the probability to continue upwards where it left off last week.

In summary, the correction for the European majors and the USDX are in line and for the GBPUSD may try to take a lead role other than the Euro for the time being with a target objective of 1.5580 which happens to be in striking distance. But what is more critical is to follow the USDX which may attempt to go lower than our initial support of 79.20- 80.00. Whenever this hold true again, we are looking a t the 78.50 mid-range basis points as the next Fibonacci retracement levels.

With the next reports looking more favorable for another USD rally; but the momentum may not hold or sustain these levels if and when there would not have enough volumes to back it up. this will then tend to move the USD lower beyond the target support. And these next two days will prove this analysis right or wrong.

Good Luck and Happy trading!