USD - Bullish Breakout Ascending Triangle
In my opinion, USD has a higher probability to breakout to the upside based on several reasons listed below. It’s also trading within an ascending triangle, and has been consolidating for the last couple of trading sessions, both of these signals are bullish to me given the economic backdrop in the US currently.
1.) Still strong US economy, based on the slew of positive economic data we’ve been seeing. Examples would be low jobless claims, good nominal wage growth and low inflationary pressures.
2.) Long end interest rates (10 yr) are rising due to reduced investor fears, which means a positive economic outlook for the US. Higher expected economic growth leads to a strong dollar.
3.) Corporate earnings are likely to keep surprising to the upside, since projections have been lowered so much over the last few months. Again, improving economic projections.
4.) More likely for positive rather than negative news to come out regarding US-China trade deal. Both sides are committed and evidence suggests a positive outcome.
1.) Still strong US economy, based on the slew of positive economic data we’ve been seeing. Examples would be low jobless claims, good nominal wage growth and low inflationary pressures.
2.) Long end interest rates (10 yr) are rising due to reduced investor fears, which means a positive economic outlook for the US. Higher expected economic growth leads to a strong dollar.
3.) Corporate earnings are likely to keep surprising to the upside, since projections have been lowered so much over the last few months. Again, improving economic projections.
4.) More likely for positive rather than negative news to come out regarding US-China trade deal. Both sides are committed and evidence suggests a positive outcome.
Transaction en cours:
USD breaks through long time resistance as predicted based on positive macro news flow. Continuous positive earnings surprises helped push the USD above it's resistance, breaking out of its ascending triangle, representing a bullish trend.
Current economic backdrop remains positive, more upside is highly likely.
Current economic backdrop remains positive, more upside is highly likely.
