In this article, we will take a look at the Emerging Market Currencies. Lately, we have a strong USD strengthening against these currencies which could be a worrying sign of their incoming weakness or a trade war. No matter the reason is, we could see a new crisis looming in the stock markets across the world if we get a slow down of this economies. We will take a look at the long-term technical analysis perspective of the USD/BRL, USD/RUB, USD/CNY and USD/TRY.
USDBRL is bouncing from the 3.7000 level and is extending to the upside. The first stronger upside resistance is 4.000. Wait for a daily close above the 3.9100 level for the long trade entries.
USDRUB is breaking above the consolidation triangle 63 level for an upside continuation into the 67 level. At this stage, you should look for the long trade entries with the stop loss below the 62 level targeting 67 at least on the ongoing pullback.
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USDCNY is breaking above the daily 200 SMA 6.4564 level. This is an important upside break for the pair and it would lead to an upside extension into the 6.8000 level. Look for the long trade entries on this pullback into the 6.6000 level. Only a daily close below the 6.6030 level would lead to a deeper pullback into the 6.5100 level.
USDTRY is in a upside consolidation pattern after the 4.4900 level pullback retest. Continuation triangle has been formed and will be confirmed with a break above the 4.6500. A strong upside support zone is 4.3648-4.4969.
We have used the combination of the top-down trading analysis to get this key levels explained on the charts. USD is in the near-term uptrend continuation against the most of the EM currencies and we could see the continuation of this trend moving forward.
Happy trading! (click on the chart to enlarge it)
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