- The USD/ILS has taken another turn lower in trading this morning, proving that bearish sentiment within the currency pair is strong.
- The USD/ILS is near the 3.55600 level as of this writing with typical fast fluctuations being demonstrated.
- Importantly the USD/ILS is showing a rather solid trend lower and the currency pair is also correlating to an enhanced mid-term weaker USD outlook that was helped the end of last week via weaker than expected U.S economic data.
The USD/ILS is not only trending lower, but it also rather curiously testing price levels not seen since late March 2023. It is easy to think of the Israeli Shekel in terms that would believe the currency should be struggling, because of the challenges the nation is facing while it confronts Hamas, but after the USD/ILS saw initial buying in the wake of the conflict in October a definite trend lower has emerged.
Reaction to Current Level of Selling of the USD/ILS
Intriguingly the Israeli Shekel has now traded in a stronger fashion than many other major currencies compared to the USD. A couple of factors need to be examined. One, the USD/ILS jumped significantly in the early days of the war with Hamas and went above the 4.00000 level, which was a value that developed because of widespread concerns by financial institutions.
Meaning the rather impressive bearish trend actually began from a level that was not correlated to the broad Forex market when the USD/ILS started its move lower. This means the downwards movement looks almost too good, but its starting point when it began to move lower was from an overbought position which was obvious.
Short-Term Momentum Consideration of the USD/ILS
However, what is also intriguing about the move lower in the USD/ILS is that the currency pair has broken below technical support levels from July and August of 2023. Meaning the movement lower in the USD/ILS the past week has produced more selling than other major currencies, which are still mostly fighting value ranges displayed since December. Which raises the question, why has the USD/ILS has sold off so significantly and broken through support levels other currency pairs have not been able to achieve versus the USD?
- In early trading this morning the USD/ILS went to a low of nearly 3.53500 before reversing higher.
- Some speculators may view the lower technical values seen this morning as a potential area to ignite short term buying positions in order to try and capture short-term reversals higher.
- Risk management is essential in the USD/ILS because the currency pair does have the ability to create price velocity that is not sometimes expected.
USD/ILS Short Term Outlook:
Current Resistance: 3.56150
Current Support: 3.55210
High Target: 3.57060
Low Target: 3.54400
Ready to trade our daily Forex forecast? Here’s a list of some of the top forex brokers in Israel to check out.