We hung around our firm mindset in the short dollar trade in USD/BRL & USD/CHF pairs.Any losses for bulls in dollar can be partially offset by shorts in high beta currencies like BRL.Despite the impressive price action, we’ve been cautious about embracing a broad based dollar rally confine pre payroll USD longs to a handful of currencies.Short term trading recommendations:As stated in our earlier post, on daily technical charts of USD/BRL pair, the medium term channel line support broke at 3.1328 on a closing basis which would see the probable threats for dollar’s recovery in near terms.There is sign of downswings confirmed, as RSI (14) showing downward convergence to the price curve.Slow Stochastic indicates the overbought scene as the %D line crosses over %K line exactly above 80 levels.On a short term basis we recommend shorting futures below 3.1445 levels on this currency cross but the contracts should be of near month. Trade with house money adding strict stop loss at 3.1583 and target at 3.0953 & 3.0601 levels.
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