Our focus shifts to the broader outlook for the crosses with major event risk stacking the docket next week. Here are the updated levels heading into the open of March trade.
USD crosses in focus heading into major central bank rate decisions, NFPs
Monthly/weekly opening range to offer guidance heading into March trade
Updated targets & invalidation points on EURUSD, GBPUSD, USDCAD & USDCHF
EURUSD Daily Chart
Chart Created Using FXCM Marketscope 2.0
EURUSD reacts to key Fibonacci resistance at 1.3767
Daily RSI failure to mount 60 / Support trigger break – bearish
Weekly opening range support break- bearish
Near-term support 1.3660- Break targets objectives at 1.3590/1.3613, 1.3515 & 1.3457/76
Breach above 1.3767 resistance (bearish invalidation) targets 1.38, 1.3830 & 1.3895
Key Events Ahead: Eurozone Unemployment data on Friday, ECB next week
Notes: Looking for the weekly/March opening range to offer further evidence that a more meaningful turn is materializing off of the 1.3767 resistance target highlighted in yesterday’s EURUSD scalp report. Use caution heading into the ECB rate decision on Thursday with the event likely to offer further clarity on our near-term directional bias.
Key Resistance 1.6722/54- Long bias at risk below this level
Breach targets objectives at 1.6877/90, 1.7040/65
Interim support 1.66- Break targets larger correction off Feb high
Support 1.6536, 1.6441/69- Broader trend constructive above 1.6252
Daily RSI continues to respect 40-support / pending resistance trigger- bullish
Key Events Ahead: BoE Rate Decisionnext week
Notes: 1.6722/54 represents a significant region of resistance and is defined by multiple longer-term key Fibonacci levels and the 2011 high. The pair has continued to respect this barrier on a close basis with the high close coming in exactly at 1.6742. We’ll be looking for the weekly/monthly opening ranges to form below this threshold with a break of said range likely to offer further guidance on a near-term bias heading into March trade.
USDCAD Daily Chart
USDCAD turns ahead of Fib support / TL resistance breach- bullish
Outside key reversal on 2/19 / RSI resistance trigger break- bullish
Topside resistance objectives at 1.1157, 1.1223/34&1.1300
Support now 1.1050, 1.0906- bullish invalidation
Break targets support at 1.0825/30 & 1.0702/24
Key Events Ahead: BoC Rate Decision on Wednesday
Notes: The USDCAD scalp setup highlighted earlier this month has been in play with the first two primary objectives having been achieved. A breach/close above 1.1157 is critical to maintain our near-term topside bias and again we will look for the March opening range for conviction here. Failure to do so and a shift below this week’s low suggests more meaningful correction off the December high may still be in play. Look to the BoC rate decision on Wednesday with the Canadian employment report coinciding with NFPs on Friday.
USDCHF Daily Chart
USDCHF key support range in focus- 8850/88- bullish invalidation.
Break risks losses into support targets at 8717 & 8670
Resistance 8920/35, 9039, 9069
Daily RSI trigger(s) pending
Notes: The 8850/88 support range is a key barrier we’ve noted since December as being a major inflection point for the USDCHF. Failure to close below this threshold puts the bearish bias at risk and the immediate focus is now weighted to the topside against this threshold. I’ve wanted to be on the long-side of this trade for some time now, but we just haven’t gotten the validation needed to fight this downtrend. That said, we’ll respect the March opening range while noting the risk of substantial losses with a break/close below 8850.
Follow the progress of these trade setups and more throughout the trading week with DailyFX on Demand.
Other Setups in Play:
EURJPY Rally at Risk Sub 141- Weekly Opening Range in Focus
GBPAUD Weekly Range in Focus- Bullish Scalp Bias at Risk Sub 1.86
GBPCAD Challenging Feb Range High- Scalp Bias Bullish Above 1.8037
AUDNZD Target Key Resistance- Bullish Scalp Bias at Risk Sub 1.09
—Written by Michael Boutros, Currency Strategist with DailyFX
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