- On Monday, at the start of the US session, the dollar index retreated to 102.16, forming a new August low.
Graphical analysis of the dollar index
On Monday, at the beginning of the American session, the dollar index retreated to 102.16, forming a new August low. After that, we saw further bullish consolidation moves and a return above the 102.60 level. There, we got a new support from which the index started a bullish consolidation above the 103.00 level. This morning, we found support at the EMA 50 moving average, which reinforces our claims of recovery.
We are also above the weekly opening price on the positive side, which suggests more optimism. The daily high was formed at 103.40 and the chances of seeing a continuation on the bullish side are increasing. Possible higher targets are the 103.60 and 103.80 levels. The dollar index will have additional resistance in the 103.65 zone on the 200 EMA moving average.
We see a recovery from the weekly low, is there a strength index for a further recovery?
For a bearish option, we need a further pullback below the 50 EMA and the 103.00 level. This will put pressure on the daily opening price. If the bearish momentum continues, we expect to see the formation of a new daily low. Such a scenario will strengthen the bearish scenario and the pullback of the dollar index. Possible lower targets are the 102.80 and 102.60 levels.
Among today's economic news, we highlight crude oil inventories and the 10-year bond auction. On Thursday, we have the weekly report on initial jobless claims and the 30-year bond auction. We have less economic news this week, but it is essential to remember that global events, such as geopolitical tensions or major policy changes, can significantly affect market movements. Staying informed about these events is key to understanding the full context of the market.
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