- During the Asian session, the dollar index moved slightly below the 106.60 level.
Dollar Index Chart Analysis
During the Asian session, the dollar index moved slightly below the 106.60 level. At the beginning of the EU session there was an increase in volatility in the market and the dollar fell to the level of 106.40.
This is where we find the EMA50 moving average, which provides support and stops the pullback. In the event of a break below and a pullback begins, the EMA50 moving average would act as additional pressure on the index. The lowest possible targets are 106.30 and 106.20 levels.
For a bullish option, we need a positive consolidation and a move above the 106.70 level. So, we would have to try to stay up there to form the bottom from which we would begin to continue the recovery. The highest potential targets are the 106.80 and 106.90 levels.
The economic calendar is full of news during the first week.
Today and tomorrow, eurozone-related economic news dominates German GDP, German CPI, Eurozone CPI, and Chinese Manufacturing PMI. Wednesday is full of news from the US market, and the most important is the FED decision and the future interest rate.
The interest rate is expected to remain at the same level as before, 5.50%. An increase in the interest rate would have a positive effect on the dollar index, and a fall in the interest rate would have a negative effect on the dollar index.
On Thursday the Bank of England will announce its decision on its interest rate and it is expected that it will remain at the same level and that there will be no changes until the next meeting.
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