USD Index outlook: Dollar Index dips through key supports after downbeat US jobless claims data

Slobodan Drvenica Windsor Brokers

US DOLLAR INDEX

The dollar index accelerated lower on Thursday, extending steep pullback into fifth straight day.
Fresh weakness broke below key supports at 100.28/00 (Fibo 38.2% of 94.59/103.80 rally/psychological), generating strong reversal signal.
It seems that the uptrend with massive gains in past two weeks (the index rose 8.1%) might be over and bears start to regain control.
Downbeat US weekly jobless claims (rose to 3.28 million last week from previous week's 282K) signal that the US economy is hit badly by pandemic and this is just the top of the iceberg. Jobless data come after a massive stimulus package and added pressure to the greenback, with strong bearish signal expected on today's close below 100.28 Fibo support.
However, fears that dollar may start fresh acceleration higher after deep correction remain as Fed seems to be done with measures for now and the latest $2 trillion package might not be sufficient to cushion disastrous impact of corona virus pandemic.

Res: 103.16; 103.80; 105.00; 107.00
Sup: 99.83; 99.19; 98.94; 98.43

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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