USD Index: Price objective should be somewhere closer to 95-96 levels in the medium term – OCBC
|On the US Dollar Index (DXY) weekly chart, bearish momentum remains intact. Thus, economists at OCBC Bank expect DXY to plunge toward 95.96 over the next months.
Near term upside risk
“Near term, daily momentum is showing signs of mild bullish bias while RSI rose. Price action also resembles a falling wedge pattern – typically associated with a bullish reversal. We do not rule out the risk of rebound in the near term.”
“Resistance at 105.30 (21 DMA), 105.90 (200 DMA) and 107.”
“Price action on weekly chart exhibited a head & shoulders (H&S) pattern with neckline around 104.10. Further downside puts next support at 102.15 (50% fibo retracement of 2021 low to 2022 high).”
“Assuming what we are seeing is an eventual playout of a head & shoulders beyond the near term, then the textbook price objective of the breakdown should be somewhere closer to 95-96 levels (medium term).”
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