The US$ has not enjoyed the ‘flight to safety‘ moves seen into the Yen, Bonds and Gold and looks likely to close with a bearish, almost engulfing, weekly candle. Coronavirus has sure spooked stock and Bond markets but not so with some FX pairs. The EURX weekly candle is currently bullish although printing an ‘Inside‘ candle. This kind of FX flow is opposite to what you’d expect given the moves seen across stock and Bond markets and so this divergence should be noted and viewed as a form of warning. Warning of what, though, is not clear!

DXY

DXY monthly: a bullish coloured monthly candle BUT will close as an indecision-style ‘Inside‘ candle:

DXY weekly: a bearish weekly candle as the 98 is, once again, rejected. This Flag will be re-drawn given the absence of any decent momentum:

DXY daily: a bearish day on Friday:

DXY 4hr: watch the previous S/R level of 97.15 for any new make or break:

EURX

EURX weekly: a bullish weekly candle but currently shaping up as an Inside candle:

EURX daily: note the hold above 110:

EURX 4hr:  watch for any push up to the 4hr chart’s 61.8% fib as this is also near the longer-term bear trend line:

FX Index Alignment:

• EURX: is below the 4hr Cloud but IN the daily Cloud so not aligned and prone for potential choppy EUR$ price action.
• USDX: is below the 4hr Cloud but IN the daily Cloud so not aligned and prone for potential choppy USD$ price action.

Calendar: watch out for impact from the RBA rate update, US NFP and, of course, from Coronavirus updates.