US 30 Index moves towards 41K
The US 30 Index (Dow Jones) bounces as stocks recover across the board. The recent sell-off saw many buyers bail out, but the index remained firm and is now on the path to a full recovery. However, the RSI’s bearish divergence combined with its overbought status on the chart is a sign of overextension, and buyers should refrain from being overexposed. 41000 is a fresh resistance, and a fall below 40400 would trigger a deeper correction to 40000.
USDCAD continues to slide
The Canadian dollar continues to gain more of a grip over the greenback after heading towards the 1.3600 level. The pair has been looking to drop further from its recent consolidation around 1.3740, and a series of lower lows suggests mounting selling pressure. A break below 1.3700 has prompted buyers to cover some of their bets, further easing the opposite pressure. 1.3570 is the next support, and its breach could attract momentum sellers and trigger an extended rally below 1.3500. On the upside, 1.3650 is the immediate resistance.
EURGBP grinds lower
The euro struggles over weak economic sentiment as the bearish channel continues lower. The price has been drifting lower since it hit resistance around 0.8580. 0.8620 at the origin of a swing high earlier this month is a critical level to see if the bulls can stand their ground. While the RSI’s oversold condition has brought in some bargain hunters, they will need to clear the top of the brief bounce above 0.8600 before a sustained recovery can take shape. Otherwise, the euro could be vulnerable to a sell-off and a further decline in the channel below 0.8450.