Dollar index ahead of Fed challenge and NFP report
- During this morning’s Asian trading session, the dollar index once again tested support at the 104.10 level.
Dollar index chart analysis
During this morning’s Asian trading session, the dollar index once again tested support at the 104.10 level. As in previous cases, we also got support and started a bullish consolidation this time. The index rose to 104.55, which was last week’s resistance zone. For now, we still have that resistance today, and we are slightly retreating to the 104.40 level.
Ideally, the dollar would find support here and stabilize in order to be in a position to initiate a continuation of the bullish consolidation. There, we also get the EMA 200 moving average support to stay on the bullish side. Then, the index could break above the resistance zone and climb to a new high. This confirms the bullish momentum, after which we expect further growth and conquest of higher levels. Potential higher targets are 104.60 and 104.70 levels.
The dollar has an opportunity to break above last week’s high and form a new one.
For a bearish option on the dollar index, we need a pullback below the 104.30 level. With those steps, we move below the weekly open price and the EMA 200 moving average. After that, the index is on the negative side, and the chances of starting a bearish consolidation increase. Potential lower targets are 104.20 and 104.10 levels.
Today, we have no important economic news. The party starts at the market tomorrow, and we will begin with the German GP and German inflation. This is followed by CB Consumer Confidence and JOLTs Job Openings. The leading news is the FED’s decision on the interest rate level. All forecasts say that it will remain at the same level. In the Asian session, the Bank of Japan will announce its future interest rate. And here are forecasts that the bank could leave the interest rate at the same level as before. Other important news is China’s manufacturing PMI and Eurozone inflation.
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