- On Thursday, the dollar index rose to 103.54, a new weekly high.
Graphical analysis of the dollar index
On Thursday, the dollar index rose to 103.54, a new weekly high. The index value barely touched the EMA 200 moving average, after which a pullback began. During the Asian session this morning, the index retreated to the support level of 103.10. The EMA 50 moving average provides additional support in that area.
We are now at 103.20 and need a stronger push to start a bullish consolidation. Potential higher targets are 103.40 and 103.60 levels. We expect the 200 EMA support to be found at 103.50 for further growth towards the bullish side. We are now far from last week's high at 104.80 level.
The index could return to last week's levels if it crosses the EMA 200 moving average.
For a bearish option, we need a negative consolidation of the dollar index below the level of 103.00. With that, we go to a new daily low and threaten the previous low at 102.90. If the pressure on the dollar continues, it will continue on the bearish side. With the breakout of the bullish formation and the growth of bearish swings, the pullback could be prolonged. Possible lower targets are the levels of 102.60 and 102.40.
This morning's German inflation data was in line with expectations and had no impact on the market. In the Asian session, Kona published its inflation data, which was above expectations. Monthly inflation rose from -0.2% to +0.5%. This caused the dollar to fall for a short period of time, but had no long-term impact. We have no major economic news in today's US session. Next week, despite less news, could be interesting for the movement of the dollar index.
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