USD/ILS 1H Chart: New medium pattern takes over
Updated
The situation on the USD/ILS charts is initially hard to understand, as the already broken patterns are still drawn on the chart.
Namely, the previously active ascending medium term pattern is still observable on the charts. However, one should concentrate on the new medium term descending pattern.
In the borders of that pattern a junior channel up pattern has already guided the currency rate up to the resistance line of the medium term pattern.
In regards to the near future, the pair is set to get squeezed in between the various hourly SMAs, lower trend line of the junior pattern and the resistance line of the medium term pattern. If the dominant pattern holds its ground, the squeeze should end in a break out to the downside.
Namely, the previously active ascending medium term pattern is still observable on the charts. However, one should concentrate on the new medium term descending pattern.
In the borders of that pattern a junior channel up pattern has already guided the currency rate up to the resistance line of the medium term pattern.
In regards to the near future, the pair is set to get squeezed in between the various hourly SMAs, lower trend line of the junior pattern and the resistance line of the medium term pattern. If the dominant pattern holds its ground, the squeeze should end in a break out to the downside.
Note
Upside risks dominated the USD/ILS exchange rate late in July, as the Greenback appreciated 2.20% against its Israeli counterpart.
The rate is trading in a wedge which was formed at the beginning of 2018. However, it failed to reach its upper line and the monthly R2 before peaking at 3.7075—its highest position since March 2017. A subsequent fall and a breakout from the junior channel soon followed.
Given that the upside momentum has allayed significantly during the past few weeks, it is likely that the Greenback breaches the aforementioned wedge and falls even lower down to the monthly S1 and the 55-day SMA at 3.63.
The nearest important support level is the 100-hour SMA and the monthly PP. The rate might hinder near this area for some time before resuming its decline down to 3.63.
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