- On Tuesday, the dollar index retreated to a new weekly low at 100.51.
Graphical analysis of the dollar index
On Tuesday, the dollar index retreated to a new weekly low at 100.51. During the Asian session this morning, the index started a bullish consolidation that is still active. The dollar recovered to 101.00 and received support from the EMA 50 moving average. We are now at 100.95 and we expect to stay in this small bullish channel and rise to a new daily high.
If we manage to stabilize above 101.00, it would be a small success that would strengthen the bullish position of the dollar index. This is a crucial moment for the index. After that, further bullish consolidation and the conquest of higher levels remains. Possible higher targets are the levels of 101.20 and 101.40. A big test for the index is at 101.40 on the EMA 200 moving average.
We are in an uptrend since this morning, do we have the strength to continue?
For a bearish option, the dollar index would have to turn to the bearish side and fall below 100.80. This would fall below the EMA 50 moving average and lose its support, which would increase the pressure on the index to start a fresh pullback. In that case, the bearish consolidation would take us below the weekly opening price of 100.60. Possible lower targets are the 100.40 and 100.20 levels.
Among today's news, we highlight crude oil inventories. The data will show in which direction crude oil stocks are moving. Tomorrow is an important day for the index because data on US GDP and initial jobless claims will be released. GDP is expected to rise from 1.4% to 2.8%. If the data is higher than expected, it will positively affect the dollar index.
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