In this article, we will take a look at the Emerging Market Currencies. We will take a look at the technical analysis perspective of the USD/BRL, USD/ZAR, USD/CNY, and USD/TRY.
USDBRL is turning higher from the 3.7600 support and we could see a test of 4 and possibly beyond as long as the 3.70-3.75 zone is holding. Only a daily close below the 3.7600 will invalidate the upside continuation.
USDZAR is breaking above the falling channel 14-14.200 zone. This break could lead to an extension higher into the 15 level as long as the previous resistance zone, now turned support is holding. Only a daily close below the 13.95 level will call for a downside scenario.
USDCNY now only a daily close above the 6.80 level would invalidate the downside extension. A daily close below the 6.7000 is required for a downside continuation and a high probability short trade entries. A daily close above the 6.80 level could lead to a test of 6.85. Bounce from the middle of the downtrend channel could lead to a shooting area of 6.7500 which is ongoing now.
USDTRY is testing the 200 SMA for an upside reversal higher above the 5.36 level. A daily close above this level will end the 5.13-5.30 recent range. For a downside continuation within a falling channel, we need to see a daily close below a 5.30 level and as an invalidation of the upside extension. The price action suggest an impulsive swing higher into 6 level.
We have used the combination of the top-down trading analysis to get these key levels explained on the charts.
Happy trading! (click on the chart to enlarge it)
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