- During this morning's session, the dollar index fell to 101.31, its lowest value this year.
Graphical analysis of the dollar index
During this morning's session, the dollar index retreated to 101.31, its lowest value this year. After that, a bullish consolidation started up to the level of 101.60. Here, we find a new resistance that directs us back towards the daily opening price. Now, we are at the level of 101.43 and trying to stay above the daily opening level on the positive side.
If the dollar index manages to break above the level of 101.60, it would form a new daily high, which would be considered very positive for the index. After that, we expect to see further progress towards the bullish side. The higher potential targets are the levels of 101.80 and 102.00. At the level of 101.80, we will reach the EMA 50 moving average before continuing the recovery. The EMA 200 moving average, which is an obstacle to our concrete move towards the bullish side, is located at 102.40 in the weekly opening price zone.
Pressure on the US currency continues this week
For a bearish option, we need a continuation of yesterday's negative consolidation below the 101.40 level. After that, the dollar index would have to form a new daily low and thus confirm that there is no strength for a reversal. With the bearish momentum increasing, all that remains is to see the index retrace to a new low. Possible lower targets are the 101.20 and 101.00 levels.
We highlight crude oil inventories and the FOMC meeting minutes from today's economic news. For Thursday, we have initial jobless claims, the S&P Global US manufacturing PMI, the S&P Global services PMI, and an existing home sale. Dollar volatility will be at its highest tomorrow, and with it will be all dollar pairs, as well as oil and gold.
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