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18 Apr 2014
USD outlook has deteriorated - JPMorgan
FXStreet (Bali) - The backdrop for the short term USD view has deteriorated over the past several weeks, according to John Normand and Niall O'Connor, FX Strategists at JP Morgan Securities.
Key Quotes
There is risk that a deeper corrective phase is underway. Importantly, this follows the failure against a number of important resistance levels for the DXY despite signs of a potential upside extension."
"We see a critical test at the next line of important support levels which should help define whether a more sustained corrective phase can develop. In this regard, the early-April failure for the DXY at the key 80.55/58 resistance zone highlights the short term bearish setup."
"This area represents the late-February high and the 61.8% retracement of the decline from the January peak and remains important for signs of a bullish reversal."
"In turn, the focus is now on the medium term range lows starting with the 79.27 March low and extending into the critical 78.99/78.60 area which includes the lows going back to May 2012. Importantly, this area will be critical for the medium term picture."
Key Quotes
There is risk that a deeper corrective phase is underway. Importantly, this follows the failure against a number of important resistance levels for the DXY despite signs of a potential upside extension."
"We see a critical test at the next line of important support levels which should help define whether a more sustained corrective phase can develop. In this regard, the early-April failure for the DXY at the key 80.55/58 resistance zone highlights the short term bearish setup."
"This area represents the late-February high and the 61.8% retracement of the decline from the January peak and remains important for signs of a bullish reversal."
"In turn, the focus is now on the medium term range lows starting with the 79.27 March low and extending into the critical 78.99/78.60 area which includes the lows going back to May 2012. Importantly, this area will be critical for the medium term picture."