USDOLLAR tests lower boundary of weekly consolidation pattern.
Weekly Chart Analysis
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The dollar's consolidation continues. FXCM's USDOLLAR basket has drifted sideways in a symmetrical triangle pattern (converging green lines). However, the last few weeks' price action is interesting.
1. Candle 2 is a bearish reference candle. I.e., it has the highest high in at least a three-candle cluster.
2. Candle 3 closed below the low of the reference candle.
3. This has completed a potential swing high, which implies that pressure is to the downside.
4. In response, the USDOLLAR is testing the lower boundary of the symmetrical triangle.
5. The weekly RSI has dipped below 50 (blue square). The longer it maintains on the bearish side of 50 the greater the likelihood of a breakdown from the symmetrical triangle pattern.
Russell Shor
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.
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