USD rises

It is certainly rare to see USD rising with such momentum nowadays. Until recent weeks USD has been forecasted by many to continue on its bear move. Even for me, I would still consider USD to be in the bear.

In my earlier entry, I mentioned of a head and shoulder formation which would result in a further drop of USD to SGD1.3569. But that would also requires a retracement to the neckline before moving further south.

The USD was doing this the last 3 days, but I was really surprise by its momentum. In fact using the daily chart, the 3 days move resemble a 3 white soldiers candlestick. This is a very bullish pattern, the last I saw this was in Tiong Woon, which eventually led to a position much higher than my expectation. So is USD deserting its head and shoulder pattern?


Fig 1 USD Weekly chart
I suspect so, for one thing, it has already penetrated the neckline from below. This is not common for a head and shoulder formation.More over, it pushing through the previous lows in the area.

If USD is moving up, the next resistance it is going to meet is around SGD1.4158 to SGD1.4240. This is the approximate location for the previous high. I suspect it might pull back from there before gaining further ground. This is mainly because the daily indicators are at the peak although both weekly and monthly are below 50% range. Anyway, it is also getting very close to the negative gradient of the Gann Grid line, so there is a good chance of this retracement.