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Dollar Bloc Commodity Currencies; AUD, NZD and CAD Remain Weak

Technical Analysis

Video Analysis

Forex markets are still building on the US Dollar positive reaction to the July FOMC statement, with US Dollar bull themes re-energizing into August.

In particular, we focus here on the Canadian, Australian and New Zealand Dollars, with further multi-year lows likely for these currencies against the Greenback.

USDCAD

  • A strong rebound late last week to reject the prior setback and leave an upside bias for Monday.
  • Furthermore, the strong July advance above the 2009 peak at 1.3064 to a 10 year high, leaves risks for a push higher into early August, to aim for further, long term upside targets.

Short/ Intermediate-term Outlook – Upside Risks:

  • We see a bullish threat to 1.3103.
  • A break above aim for longer term targets at 1.3346 and 1.3454.

Monthly USDCAD Chart

usdcad

AUDUSD

  • Whipsaw price action Friday to end July, and despite the rebound from a new cycle low, the bounce and stall back lower for a neutral outside pattern, leaves a bear bias into Monday.
  • Furthermore, the July plunge lower to probe below long term support at .7269, after the late June plunge through the prior 2015 low at .7533, leaves a bearish theme into August.

Short/ Intermediate-term Outlook – Downside Risks:

  • A bear bias with the downside risk in August to .7269 and .7091.
  • A break through these supports targets the psychological .7000 level.

Monthly AUDUSD Chart

audusd

NZDUSD

  • The probe and failure on Friday, back from ahead of the .6738/43 resistance area, to maintain a bear bias for Monday and again reject the previous push above the intermediate-term trend line from late April and Dow Theory swing high at .6682.
  • Moreover, whilst below .6772, the risk into early August is for the underlying bear trend to re-energize.

Short/ Intermediate-term Outlook – Downside Risks:

  • The August bearish threat is to long term support levels at .6404 and .6196/54.
  • The risk through here is maybe to psychological/ option target at .6000.

Monthly NZDUSD Chart

nzdusd

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