USD Whacked Vs The Majors - Forex News by Strategia Forex
Let's see how the US economy performed in Q2

USD Whacked Vs The Majors

Posted Wednesday, September 4, 2019 by
Shain Vernier • 2 min read

The Greenback is taking it on the chin vs the majors in today’s forex action. Losses against the Canadian dollar and Euro have highlighted the action, driven by Brexit and BoC developments. In addition, a sub-par IBD/TIPP Economic Optimism (MoM, Sept) has fueled the intraday exodus from the USD.

Typically, the mid-U.S. session brings no scheduled news items. However, today is unique in that regard. A collection of FED member speeches, as well as the U.K. Parliamentary Vote, are on the economic calendar. If you are trading the forex majors, be on the watch for enhanced volatility throughout the remainder of the U.S. trading day.

USD Lags Vs The Majors

As we alluded to last Friday, early September has brought stiff action to the markets. Participation is heavy in commodities, currencies, and equities, driving prices directionally in many assets. For now, it is time to buckle up and deal with the volatility.

Several of the forex majors have turned in large intraday ranges, with none being bigger than the USD/CAD. A somewhat hawkish BoC Statement and bull-run in WTI crude have driven a 100+ pip plunge in rates.

USD/CAD, Daily Chart
USD/CAD, Daily Chart

 Here are a few support levels to watch in the Loonie for the remainder of the session:

  • Support(1): Lower Bollinger Band, 1.3213
  • Support(2): Psyche Level, 1.3200
  • Support(3): 50% Macro Wave Retracement, 1.3198

Bottom Line: As of this writing (about 12:30 PM EST), the USD/CAD is posting an intermediate-term correction beneath the macro 38% Fibonacci retracement (1.3242). If the bearish price action continues, an area of strong support may come into play.

Converging indicators are a good thing and that is what the USD/CAD has near 1.3200. Until elected, I will have buy orders in queue from 1.3215. With an initial stop at 1.3174, this trade produces 30 pips on a sub-1:1 risk vs reward ratio. 

The coming hours are likely to bring heavy volatility to the majors. If you are holding open positions, stop losses and moderate leverage are recommended.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
Related Articles
Comments

Leave a Reply

avatar
  Subscribe  
Notify of