US Dollar corrective losses (as we had expected) set to extend

Chris Lee

As we had discussed in our last report on here, an extension of US Dollar losses into late April has secured short/ intermediate-term tops for the US currency against other Major Currencies.

The Euro and Australian Dollar expressed a more positive tone last week after previous strong recovery efforts by the British Pound, plus the Canadian and New Zealand Dollars. This leaves risk into early May for further US$ setbacks. USDJPY, however, is opposing this trend of US Dollar corrective weakness, with risk shift for a bullish breakout.

EURUSD Bottoms Out for Bullish Bias

  • The extension last week above 1.1249 produced a shift to a more bullish tone into May.
  • This reinforced the previous break through 1.1053 that set a base.
  • Into early May, we see a more positive tone with the bullish threat to 1.1380. A break above here would target 1.1449 and 1.1534.

Daily EURUSD Chart



  • Despite a dip lower into the end of April, we see upside pressures for May from the rally through .7938, which defined a base and the push above chart/ retrace resistance at .8027 and .8062 that set a more bullish outlook.
  • We see a more positive tone with the bullish threat back to the new recovery peak at .8076, then to .8137.
  • Above here targets key levels at .8224/34 and .8295.

Daily AUDUSD Chart


BUT, USDJPY Bias to Upper End of Range

  • Although the US Dollar has been in a more negative tone against most of the global major currencies in late April, a more resilient tone has been expressed against the Japanese Yen.
  • The USDJPY rebound from ahead of key support at 118.33 and critical support at 118.14 sees a shift in focus to the upper end of the multi-month range.
  • We now see the bias for a challenge to the key upside level at 121.20, through which would target the secular peak at 122.02.

Daily USDJPY Chart