Thread by @DoejiStar

Hope you had a good week/end.
Here's my updated look at $USD charts and themes:

📉📈USD index $DXY $DJFXCM shoulderline to hold?
📉📈$USDCNH driving USD weakness but did we bottom?
📈📉$EURUSD strong recent demand out of steam?

$DXY looking oversold trading outside the 1sd band. $DJFXCM equal-weighted index showing similar except it has broken out of channel and completed measured move up, and consolidating back down. Both holding above key shoulderline support area.

$USDCNH completes measured move down from neckline at 6.91 to last weeks low at 6.627. A (weak) weekly reversal candle with momentum divergence on lows all makes a strong technical case for a bounce.

PBOC are concerned about sharp $CNY appreciation which can hurt exports and ...

...and inflation/growth objectives. They will take whatever action necessary to achieve targets and if they are to stabilize $CNY, these are historically a good referece point to see how much they are willing to weaken $USD against $RMB.

I expect upward consolidation from here.

$EURUSD no daily close below trendline to produce false break signal, but assuming Sep top is in, this is a classic consolidation pattern and a solid turn at next key levels would be expected. 1.1880 is a closed eyes ell imo with room to average above.

$EURUSD month-on-month seasonality going back 25 years shows OCT and NOV as weak months historically (chart1).

$USD seasonally strong in Oct Nov going back 25 years (2), Oct the strongest month in last 6 elections, and Oct Nov particularly strong in last 3 election years (3).

$EURUSD 2wk 25d risk reversals (purple) has turned and leveled off as EURUSD made a strong close to last week - hinting at lesser upside for this rally.

$USD is down about 1% so far this month and none of the seasonality is holding up. Comparing data however - Europe showing improvement in mfg PMI's but services haven't been getting off the ground. Covid ravaging Europe UK USA and elsewhere risks further demand shocks as...

...restrictions and impact to service sectors get prolonged, and ripple-out, services being by far the largest contributor of GDP. Meanwhile US data is has some upward momentum and #FED will sit tight hoping recovery continues on at least the current pace while #ECB face both...

...low inflation and sudden $EUR strength. Forecasts/targets may need revising down and actions taken to expand monetary relief and cap EUR strength.

Very well aligned pivot levels across $USD charts and like timing of relative themes in support of a rally. 👀out for the turn.