FOREX TRADING

EUR/USD closed lower on Tuesday as it consolidates some of the rally off this month’s low. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are oversold but remain neutral to bullish signalling that additional strength is possible near-term. If it extends this month’s rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing would temper the bullish outlook.

USD/JPY closed lower on Tuesday and below the 10-day moving average crossing signalling that a short-term top might be in or is near. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are diverging and are turning neutral to bearish warning bulls that a short-term top might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted.

GBP/USD closed lower on Tuesday and the low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are oversold but remain neutral to bullish signalling that additional strength is possible near-term. If it extends this month’s rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term bullish outlook.

USD/CHF closed lower on Tuesday as it extends some of this summer’s decline. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bullish signalling that sideways to higher prices are possible near-term. If it extends this summer’s rally, the 87% retracement level of the 2009-2010-decline crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

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