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 pulling back after the rejection from 4.2000 level. We could see a deeper pullback into the 3,9500 level. Don’t chase the long trades at the moment. The overall trend is an upside. The upside support zone which could be tested is 3.9500-4.0000.
USDRUB is testing the 70 level of the rising wedge. This rising wedge level could lead to a rejection for a pullback into the 67 level. Look for a reaction from here for direction.
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USDCNY is in the consolidation 6.8000-6.8400 zone. We could see a break of this range soon and look for a possible pullback lower or extension higher depending on a price action.
USDTRY has bounced off the strong upside support 6.0000 level and could be making a consolidation triangle before a larger upside swing. Look for a possible pullback into the 6.0500 level. The upside continuation will be valid on a daily close above the 6.8000 level.
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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