Technical FX traders should be cautious in following EUR/USD to the upside and USD/CHF to the downside, and instead they might consider chasing the downside trend in USD/JPY, advises Deutsche Bank based on the latest data from its technical scorecard.
"EUR/USD tops the technical scorecard in G10 space. The currency pair is highly trending with VHF at 88th percentile and is breaking new ground to the topside at 98th percentile. Though it has smooth price action in terms of realized and implied volatility metrics, the pair is highly stretched in terms of the RSI measure, suggesting caution in chasing the trend.
Alongside this, USD/CHF has similar characteristics signaling caution.
USD/JPY may be a better choice, with decent trendiness and relatively less stretched price action (to the downside)," DB notes.
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