The US Dollar has been stranded in a channel up against the Danish Krone for the last three months. If looking at the pair’s movement this month, two additional channels can be distinguished. The senior one has guided the pair towards the bottom boundary of the aforementioned dominant pattern circa 6.28. From that point forward, a junior ascending channel was formed. A retracement from the 6.28 area suggests that the pair might be set for appreciation in the medium term. However, in order to do so, the Greenback has to breach the upper line of the middle pattern, reinforced by the 200-hour SMA and the monthly PP in the 6.367 area. It is likely that the pair pushes up to this mark within the following trading sessions, but the subsequent movement should nevertheless be to the downside where it could test the most senior pattern and the monthly S1 circa 6.29/30. The pair should then resume its general direction north.
