Chart of the Day: US Dollar Index

Blake Morrow Forex Analytix

US Dollar at major support!

The US Dollar index is at major technical support. We are trading around the 38% retracement of the July 2023 lows to the October 2023 highs. The recent pullback Also is at the previous descending channel trend line (see 2023 price move until September). Also, just below price is the 50% retracement, 200dma and potentially bull flag pattern support.

Even though the US Dollar has fallen this week due to (slightly) weaker CPI, a drop in yields and rally in stocks (overall), this support may be stronger than most expect. With the stock market looking vulnerable to a pullback near term, US data, although weaker, not horrendous, upcoming PMI's next week our of Europe, the "USA exceptionalism" story may not be over yet.

A rally back above the 50dma would be very bullish for the US Dollar index at around the 105.75 level.

Author

Blake Morrow

Forex Analytix

Blake Morrow spent most of his professional career as the Chief Currency Strategist for Wizetrade group for 15 years, and then the Senior Currency Strategist for Ally Financial after the acquisition of Tradeking which owned the Wizetrade Group.

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