Talking Points:
– USDOLLAR Threatens Bearish Setup; Yellen Testimony in Focus
– GBP/USD Posts Larger Correction Ahead of U.K. CPI; Buy Opportunity?
– Bullish AUD/USD Formation at Risk as RBA Toughens Verbal Intervention

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10416.31

10421.32

10403.68

0.06

63.73%

USDOLLAR (Ticker: USDollar):
Dow Jones-FXCM U.S. Dollar Index at risk for larger correction as price & RSI fail to maintain bearish trend.
With the broader downward trending channel still in play, downside targets remain favorable, while former support around 10,440 (78.6% retracement) may offer near-term resistance.
The Humphrey-Hawkins Testimony with Fed Chair Janet Yellen presents the largest event risk for the USDOLLAR; will we get more of the same?

GBP/USD:
Will continue to look for closing prices above the 1.7100 handle as 1.7060-70 (23.6% retracement) offers intraday support.
U.K. Consumer Price Index (CPI) may limit the correction as headline reading for inflation is expected to increase an annualized 1.6% in June.
Topside targets remain favorable as price & RSI preserve bullish formations from earlier this year.

AUD/USD:
May fail to preserve ascending channel formation should the Reserve Bank of Australia (RBA) Minutes highlight recent comments from Governor Glenn Stevens.
Near-term support still stands at 0.9330-40; need break and close below to see a move back towards the 0.9200 handle.
China 2Q Gross Domestic Product (GDP) will also be a key event risk to watch as the growth rate is expected to expand 1.8% versus 1.4% during the first three-months of 2014.

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Read More:
Price & Time: Time To Be Skeptical of Equity Market Strength
EUR/USD Pinned as EUR/JPY Pivots from June Swing; USD/CAD Emerges

USDOLLAR Daily

Chart – Created Using FXCM Marketscope 2.0
Interim Resistance: 10,508 (61.8% retracement) to 10,524 (38.2% retracement)
Interim Support: 10,354 (Oct. low) to 10,375 (50.0& retracement)

Release

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Expected

Actual

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— Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

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Source: Daily fx