By Orbex
USDJPY retreats below resistance
The dollar bounced back against the yen after a weak Tokyo CPI in September.
As the pair rose to the peak from February 2020 (112.20), a bearish RSI divergence revealed weakness in the momentum. A break below 111.20 and a bearish MA cross may have dented optimism.
The US dollar has seen bids at 110.90 when the RSI neared the oversold area. However, the bounce has been capped by 111.50 as trapped buyers were waiting to get out. A new round of sell-off would send the price to the psychological level of 110.00.
USDNOK tests critical support
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Rally in oil prices helped lift the Norwegian krone against the greenback.
The pair had met stiff selling pressure in the supply zone around 8.8000. A sharp drop below 8.6500, which has turned into resistance, suggests that sellers have regained control of the action.
A close below 8.5500 (a major support from the daily chart) would invalidate the latest rebound and put the dollar on a bearish trajectory. An oversold RSI may cause a temporary bounce. 8.4500 would be the next stop when momentum traders stake in.
GER 40 hovers over major support
Stock markets still jitter over ongoing supply chain disruptions.
The Dax 40 has been treading water over the psychological level of 15000. A bullish RSI divergence in this important demand zone indicates that selling has become less aggressive.
However, it may be too soon to call for a U-turn. The bulls must take out 15330 before they could convince trend-followers of a turnaround. Then, 15700 would be the next hurdle.
On the downside, a bearish breakout would trigger a wave of stop-losses, sending the index towards 14500.
Article by Orbex
Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com
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