With both the US and Canada out on a bank holiday, we’re seeing a relatively quiet session in the FX market. As the chart below shows, the dollar index is falling for its third consecutive day after rally though the first seven days of the month.
Year to date, the dollar index has formed a minor higher high and higher low, suggesting that the long-term uptrend may be resuming after the December swoon. There are still potential longer-term concerns about the greenback’s rally, but the shorter-term momentum is pointing higher for now.
For this week, the key level to watch will be previous-resistance-turned-
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