US Dollar Selloff Pauses After Prices Clear Critical Support

DailyFX

THE TAKEAWAY: The US Dollar has stalled to digest recent losses after breaking its 2013 rising trend as traders await the outcome of the FOMC monetary policy meeting.

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US DOLLAR TECHNICAL ANALYSIS Prices moved lower as expected after putting in a Bearish Engulfing candlestick pattern. Sellers have now overcome the 38.2% Fibonacci retracement at 10510, exposing the 50% level at 10397. Near-term resistance is at 10576, marked by the March 11 high and a broken rising trend line set from December 2012. A move back above that eyes the 23.6% Fib at 10650.

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Forex_US_Dollar_Selloff_Pauses_After_Prices_Clear_Critical_Support_body_Picture_5.png, US Dollar Selloff Pauses After Prices Clear Critical Support

Daily Chart - Created Using FXCM Marketscope 2.0

S&P 500 TECHNICAL ANALYSIS – Prices edged through resistance at the top of a falling channel set from late May, exposing the 23.6% Fibonacci retracement at 1645.50. A push above that targets the 38.2% level at 1675.30. Channel resistance-turned-support is at 1632.70, with a move below that eyeing a rising trend line set from mid-November 2012 at 1614.50.

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Forex_US_Dollar_Selloff_Pauses_After_Prices_Clear_Critical_Support_body_Picture_6.png, US Dollar Selloff Pauses After Prices Clear Critical Support

Daily Chart - Created Using FXCM Marketscope 2.0

GOLD TECHNICAL ANALYSIS Prices are hovering above rising trend line support set from mid-April – now at 1370.14 – with a break lower aiming for recent swing lows in the 1321.59-38.06 area. Rising channel support-turned-resistance is at 1416.47. This barrier is reinforced by the 38.2% Fibonacci retracement at 1424.23, with a break above the latter level targeting the 50% Fib at 1455.94.

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Forex_US_Dollar_Selloff_Pauses_After_Prices_Clear_Critical_Support_body_Picture_7.png, US Dollar Selloff Pauses After Prices Clear Critical Support

Daily Chart - Created Using FXCM Marketscope 2.0

CRUDE OIL TECHNICAL ANALYSIS Prices cleared falling trend line set from late January and the 50% Fibonacci expansion at 97.09, exposing the 61.8% level at 98.47. A further push above that eyes the 76.4% Fib at 100.18. The formation of a Spinning Top candlestick below resistance points to indecision and warns a pullback may be in the cards. A move back below the trend line (now at 96.58) aims for the 38.2% expansion at 95.71

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Forex_US_Dollar_Selloff_Pauses_After_Prices_Clear_Critical_Support_body_Picture_8.png, US Dollar Selloff Pauses After Prices Clear Critical Support

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak

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