Top Story

Dollar Index: 20-Month High Near 97.70 in Sight?

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-support around 96.65. If that near-term floor is broken, bears may look to push the pair down toward the Fibonacci retracements of this month’s rally at 96.27 (50%), 96.00 (61.8%), and 78.6% (95.63). Meanwhile, the key resistance level to watch will be the peak of Friday’s bearish engulfing candle at 97.37; if buyers are able to overcome last week’s peak, the dollar index could be testing its 20-month high at 97.70 this time next week.

Source: TradingView,

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.