The Dow Jones keeps its bullish trend

The Dow Jones index seems to be resting for today and the daily candle is forming what it appears to be a “doji” formation. That doji could indicate some exhaustion of the recent rally, but the uptrend is still in place. In case the index breaks to the downside the bullish trendline that we see on the daily chart, it could try to go and visit the 200 day exponential moving average, around the 17280 level, which could act as support. To the upside, the 17909 level could act as resistance, but above that level, the 18078 could also act as resistance.

The Pound keeps its bearish trend

The Pound versus the Dollar retraces above the 1.5100 level, but its bearish trend is still in place. The pair may try to fall to the 1.5000 level, which could act as its next support. To the upside, the 1.5200 level could act as resistance, but we don’t have real strong fundamentals to merit a rally above current levels. The pair has been respecting the round number levels, therefore it pays to be attentive of those zones for possible entry opportunities.

Big rally on the Dollar after the NFP numbers

Today we had the highly anticipated Non-Farm Payrolls number out of the US. The reading of new jobs created for the month on October came out much better than expected, causing the Dollar to rally versus its major peers. It was forecasted a reading of 180K new jobs, but the reading actually came out at 271K new jobs. The unemployment rate fell from 5.1% to 5% and the average hourly wages rose 0.4% when the forecasted was a rise of 0.2%. The numbers clearly came out way better than expected, and actually this has been the best reading since 2009. The Dollar index broke above the 98.39, but if it retraces, that level could act as support. Its next resistance could be the 100.28.

The Russian Ruble stays in a bearish channel

The Dollar versus the Russian Ruble on the daily chart has been consolidating around the 55 period exponential moving average, around the 63.57, but in the longer term we can see that the pair has formed a bearish channel. The price stays within that channel and it could try to head lower. If the price drops from the current levels, then the 200 day exponential moving average, around the 59.07 level could act as support. If the price breaks the upper trendline of the channel, then the pair may change direction, but in order for that to happen the Dollar would have to strengthen with the upcoming US fundamentals.

EUR/JPY: Bearish breakdown of symmetrical triangle

On Monday we identified a symmetrical triangle on the Euro versus the Yen, daily chart. Today we can see that the price has broken below the triangle and the formation has acted as a continuation pattern. At the moment the price has reached the 132.00 level, which could act as a support, but if it breaks that level to the downside, then the bearish momentum may accelerate and it may try to go and reach the 131.00 level. To the upside, the 133.00 could act as resistance, but above that level, the 135.00 could be an even stronger resistance.

Bullish flag on the Kiwi

The “Bullish Flag” is a continuation pattern that forms at the end of an uptrend. The pattern forms when the price consolidates after a bullish run and starts going sideways, but with a slight slope to the downside. On the daily chart of the New Zealand Dollar versus the US Dollar we can see that once the price touched the 200 day exponential moving average (blue line), it started correcting to the downside and creating what we call a bullish flag. Today the price breaks below the 0.6700 level and it is close to touching the 55 day exponential moving average (purple line), which is just above the 0.6600 level. The 55 day EMA may act as a support and the price may try to bounce to the upside from there, but if it breaks that zone to the downside, then the bullish flag would be invalidated and the price may try to go and reach the 0.6500 level. To the upside, the 0.6800 may act as a resistance, but the 200 day EMA may act as a stronger resistance on the Kiwi.

Symmetrical triangle on the EUR/JPY

The Euro versus the Yen on the daily chart has been oscillating between the 133.00 and the 132.00. During that consolidation, the price has formed what it appears to be a “symmetrical triangle”. The Triangle formations usually act as continuation patterns, meaning that the price continues in the direction where it was coming from coming into the formation, but in reality the price may break out in any direction. If the price breaks to the downside, then the 131.00 level could act as support. If the price breaks to the upside, then the 135.00 level could act as resistance.