Economy

Dollar index under pressure at 104.70 level on Monday

FinanceBrokerage - Forex Rates: The greenback went into a steady pace near to a two-week high against other major peers.

Dollar index under pressure at 104.70 level on Monday

  • During this morning’s Asian trading session, the dollar index moved in the 104.68-104.75 range.

Dollar index chart analysis

During this morning’s Asian trading session, the dollar index moved in the 104.68-104.75 range. Last Friday, na showed a weak dollar and retreated from 105.11 to 104.60. With the return below the EMA200 moving average, the dollar remains under pressure. Last week’s bullish formation was interrupted by this morning’s movement, and now we expect a bearish impulse and a drop to a new daily low.

Potential lower targets are 104.60 and 104.50 levels. At the 104.50 level, we will test last week’s weekly open price. We need a positive consolidation and a return above the 104.80 level for a bullish option. With that step, we move to the positive side above the EMA200 and the weekly open price. The index is shedding some of the pressure and could start a recovery from there. Potential higher targets are 105.00 and 105.10, Friday’s high.

Dollar index chart analysis

The return of the dollar below the EMA200 moving average increases the bearish pressure.

For a bearish option, we need a new bearish impulse below 104.60. With that, we go to a new weekly low and start a bearish momentum. After that, the index should begin to retreat to lower levels. Potential lower targets are 104.50 and 104.40 levels.

Today is a public holiday in the US – Memorial Day, so we have no news in the US session. From the EU session we release the Eurogroup meeting and later the speech of the European Central Bank Philip R. Lane. The first important news for the dollar is tomorrow: CB Consumer Confidence, then USD GDP, Initial Jobless Claims and Crude Oil Inventories on Thursday. During the publication of this news and depending on the published data, we can expect increased volatility on the chart of the dollar index.

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