USDollar Takes a Beating as April Low Looms

 
on September 11 2012 2:00 PM

The US Dollar is taking a beating this morning. USD weakness since Friday has been extraordinary....certainly an interesting market to return to after being away for over 2 weeks! The EURUSD and AUDUSD in particular are nearing interesting levels. The EURUSD has slightly exceeded the 5/21 high (12824) and near term levels of interest are now the 5/15 high at 12868 and the 5/11 low at 12904. The AUDUSD is nearing the trendline that extends off of the August highs, 7/19 high and 8/15 low (10444/55). I'll maintain a bearish bias against 10550 (8/23 high and incidentally the day that I left for vacation).

Some other things to consider ahead of Thursday's much anticipated Fed circus:

-NZDUSD is 40 pips from its August high while the AUDUSD is 170 pips from its August high; is another divergence in the works?

-Given the extent of USD weakness today, I find it odd that gold has yet to reach its 1755 objective (breakout from August) / 1760 pivot area...maybe these levels (and perhaps 1800) are reached on an initial Fed reaction Thursday in a classic 'buy the rumor, sell the news' dynamic.

-The USDJPY is nearing the June low and remains on track for a drop to record lows...and probably a sharp increase in volatility.

EURUSD - Daily Bars

USDollar_Takes_a_Beating_as_April_Low_Looms_body_eurusd.png,

Prepared by Jamie Saettele, CMT

AUDUSD - 240 Minute Bars

USDollar_Takes_a_Beating_as_April_Low_Looms_body_audusd.png,

Prepared by Jamie Saettele, CMT

To contact Jamie e-mail jsaettele@dailyfx.com. Follow me on Twitter @JamieSaettele

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Jamie is the author of Sentiment in the Forex Market.

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

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