- The first three days of this week were positive for the dollar index, jumping from 103.20 to 104.20.
Dollar Index Chart Analysis
The first three days of this week were positive for the dollar index, jumping from 103.20 to 104.20. Yesterday we saw resistance at that level and a bearish consolidation that takes us to the 103.30 level. There we obtain new support that begins a bullish consolidation that continues today until the level 103.80. Additional support is provided by the EMA50 moving average in the area around 103.60, which could take the dollar towards the 104.00 level altogether.
By breaking above 104.00, we have a new opportunity to test the previous high and break above. The highest potential targets are the 104.20 and 104.40 levels. We would need to fall back below the EMA50 and the 103.60 level for a bearish option. After that, we test the 103.50 level and if it does not hold, the dollar continues to retreat again, looking at the 103.20-103.30 support zone. The lowest possible targets are the 103.00 and 102.80 levels.
Next week brings very important news.
For Monday, we only have the US 10-year bond auction, then on Tuesday we have the US monthly CPI auction, US annual CPI and 30-year bond auction. On Wednesday morning, at the opening of the EU session, we have the British GDP, the rest of the news is in the US session: US PPI, crude oil inventories, decision Fed on interest rates, FOMC statement and NZD GDP.
Thursday is D-day for the entire market. To start the day: Bank of Switzerland interest rate decision, Bank of England interest rate decision, ECB interest rate decision. All the banks mentioned are expected to leave interest rates at the same level as before. In the afternoon we will have core retail sales, initial unemployment, retail sales and the ECB press conference in the US session. On Friday we will only have the US services PMI.
ADDITIONAL VIDEO: Weekly summary of market news
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