Technical Overview

• British Pound Aims For 1.8000
• Japanese Yen Remains Above 115.00
• Canadian Dollar Remains In Tight Range

Trader's Outlook
Dollar is on the retreat, so what. This trader believes that for the market to get where it wants to go it must take a path of least resistance, and at this point this path is being dominated by the majors. As soon as the retrace is done, that's when the real price action will begin, 1.1300 euro anyone? How about 1.6500 for the sterling or 1.3500 for the Swisse? This traders is getting ready for the move, its only a matter of time , nothing else.

1-Day Currency Pair Outlook

EUR/USD - Euro bulls remained on the bid side of the market as the greenback longs lost control of the price action with the pair heading above the psychologically important 1.2000 handle. A further move to the upside will most likely see the euro longs test the dollar defenses above the 1.2100 handle at 1.2122, a level marked by the October 17 daily high. A sustained momentum will most likely see the pair head higher and take on the greenback defenses around 1.2253, a 23.6 Fib of the 1.3477-1.1869 USD rally, which is being defended by the 50-day SMA at 1.2180 Indicators are diverging with momentum indicator above the zero line, while the negative MACD is sloping upward toward the zero line, while neutral oscillators give either side enough room to maneuver.
 
Key Levels & Technical Indicators

USD/JPY - Japanese Yen longs remained virtually unchanged as the pair continued to tread sideways above the psychologically important 115.00 handle. A break below the psychologically important 115.00 handle will most likely see the pair head lower and test the greenback defenses around 114.11, a level established by the 20-day SMA. A further move to the downside will most likely see the pair head toward the 113.20, a level marked by the 23.6 Fib of the 104.17-115.99 USD rally. Indicators remain supportive of the dollar longs with both momentum indicator and MACD treading above the zero line, with ADX above 25 at 27.26 signaling an existence of a trend not a direction of one, while overbought Stochastic gives the yen longs a chance to retaliate.

Key Levels & Technical Indicators

GBP/USD - British pound bulls felt like a million quid as they pushed the greenback toward the 1.7820, a level marked by the August 31 daily high, with a further move to the upside will most likely see the pair head higher and aim for the psychologically important 1.8000 handle. A break above 1.8000 will most likely see the cable longs take on the dollar defenses around 1.8017, a 38.2 Fib of the 1.9219-1.7284 USD rally, and with sustained momentum to the upside seeing the pair test the greenback defenses around 1.8149, a September 22 daily high.  Indicators are diverging with momentum indicator above the zero line, while the negative MACD is sloping upward toward the zero line, while neutral oscillators give either side enough room to maneuver.

Key Levels & Technical Indicators

USD/CHF - Swiss Franc longs continued to pound the dollar bids with the pair aiming toward the greenback defenses around 1.2797, a level established by the October 17 daily low. A sustained momentum on the part of the Swissie longs most likely seeing the pair take on the greenback bids around 1.2703, a level established by the 23.6 Fib of the 1.1492-1.3085 USD rally, with a further move to the downside seeing the Swiss Franc bulls take on the greenback defenses around 1.2532, a level marked by the September 14 daily high, which currently defends the psychologically important 1.2500 handle. Indicators are diverging with momentum indicator below the zero line, while the positive MACD is sloping downward toward the zero line, while neutral oscillators give either side enough room to maneuver.
 
Key Levels & Technical Indicators

USD/CAD - Canadian dollar bulls continued to push the pair sideways, helped by the US dollar counterpart to keep the pair in a tight range with neither side managing to take an upper hang as USD/CAD remains around 1.1750 mark. As the greenback longs manage to take back the control of the pair, the next move above the 1.1800 figure will most likely see US dollar longs take on 1.1862, a level marked by the 23.6 Fib of the 1.2730-1.1592 CAD rally, which is further reinforced by the 50-day SMA at 1.1836. A sustained momentum the upside will most likely see the greenback take on the Loonie defenses around 1.2028, a 38.2 Fib of the 1.2730-1.1592 CAD rally. Indicators are diverging with momentum indicator above the zero line while negative MACD is sloping upward toward the zero line; with neutral oscillators giving either side enough room to maneuver.

Key Levels & Technical Indicators

AUD/USD - Australian dollar bulls managed to push back the greenback longs above the psychologically important .7500 handle following the inability by the US dollar counterparts to push the pair below. .7457, an Aussie defensive position established by the August 31 daily low. A sustained momentum on the part of the Australian dollar longs will most likely see the pair head above the .7500 and take on the US dollar defenses around .7555, a level marked by the 20-day SMA. A further move to the upside will most likely see the pair head higher and test the greenback defenses around 38.2 Fib of the .7991-.7374 USD rally. Indicators are favoring the US dollar bulls with both momentum indicator and MACD below the zero line, while neutral oscillator give either side enough room to maneuver.

Key Levels & Technical Indicators

NZD/USD - New Zealand dollar bulls once again proved that Kiwis can't fly, but can hover well as the pair headed above the psychologically important .7000 handle. As New Zealand dollar longs manage to push tier way above the .7000 figure, a further move to the upside will most likely see Kiwi bulls lose their footing as the pair will most likely bounce off the .7075, a US dollar defensive position established by the 50.0 Fib of the .7498-.6681 USD rally. A reversal will most likely see the pair tumble below the .7000 figure and head toward the Kiwi's defenses around .6868, a 23.6 Fib of the .7498-.6681 USD rally  Indicators are supportive of the New Zealand dollar longs with both momentum indicator and MACD treading above the zero line, while neutral oscillator give either side enough room to maneuver.

Key Levels & Technical Indicators

Sam Shenker is a Technical Currency Analyst for FXCM.