Weekly outlook: ride the short

The price is coming back once again to the lower part of the channel, lets see what are the possibilities to a break of this line.

What to take on considerations:

In the fundamental side:

*The US-China trade is generating concerns on the stock and the fx market the no deal situation is bringing uncertain in the construction of a clear market direction on the DXY price.

*last week Fed Chief said the Federal Bank is not expecting more cut rate in this year, but the market is expecting no just one cut but two cut in the year end according the Fedwatch tool, in the US bond market the 10 years yield has been surpassed by the 3 month yield.

*The chance that the UK is not going to leave the Europe Union is another catalist to feed the EURUSD

This mixure of unclear information is putting away fundamentals support for the DXY so the odds to breakdown the lower part of channel are rising.

In the technical side: The price last week respected the 0.764 fibo level in the daily chart with huges relatives candle if this momentum keep in the coming week, so there could reach the lower part of the channel, again, according to the fundamental undecision the price could finally break this linea.

Source:

cnbc.com/2019/05/24/trade-and-the-economy-have-become-the-new-roller-coaster-for-markets.html

cmegroup.com/trading/interest-rates/countdown-to-fomc.html

treasury.gov/resource-center/data-chart-center/interest-rates/pages/textview.aspx?data=yield