Turnaround Tuesday After Monday’s Dollar Rally?

The U.S. dollar climbed against most major peers Monday and provided short traders, at least in the EUR/USD, a good gain.

The EUR/USD extended its slide towards 1.20 this morning and as stated in yesterday’s analysis, lower targets might be at 1.1970 and 1.19 now.

The GBP/USD finally broke below 1.39 and bears might seek to extend the downward movement towards 1.3850 and 1.3830.

It should however be noted that today is Tuesday and from our experience we know that Tuesdays have often served as turnaround days following a strong market trend on Monday.

In other words, if dollar bulls take a breather today, we could see some corrective movements in the major currency pairs. Looking for potential reversals, traders should pay attention to upside breaks above 1.3960 and 1.40 in the GBP/USD and above 1.2110 and 1.2150 in the EUR/USD.

The DAX tested the 14050 level but was unable to hold above 14000. As long as the index remains between 14160 and 13800, there is nothing new to report.

We wish you good trades!

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