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An update on an article posted on the 1st of September regarding the US Dollar Index: https://www.gomarkets.com/au/featured/us-dollar-analysis-technical-perspective/
Last week the US Dollar Index struggled to break and close above a major resistance area between $108.7 to $109.8, with a weekly candlestick breaking above but closing below the highlighted range means that the previous analysis of the US Dollar Index,( Analysis done on September 1) still holds its ground with the bears in control.
Until there is a clear candlestick close above the highlighted range, only then will we look at further upside targets for the Dollar Index.
In addition, due to the high negative correlation between the US Dollar Index and EURUSD, there may be a potential reversal for EURUSD.
EURUSD has been bouncing between a downward channel since January 2022 and has recently began forming into a potential reversal, double bottom pattern. This indicates that sellers are slowing down, and buyers are starting to come in at this critical level between $0.991 to $0.995. The double bottom could push the price of EURUSD to break above the channel, confirming a change in trend.
If the breakout is confirmed, then a potential target of $1.036 exists at the nearest daily resistance.
This analysis aligns with the potential weakening of the dollar, however a strong jump in the US Dollar could mean that EURUSD may respect the trend line at the top of the channel and continue its downtrend.
Disclaimer: Articles are from GO Markets analysts and contributors and are based on their independent analysis or personal experiences. Views, opinions or trading styles expressed are their own, and should not be taken as either representative of or shared by GO Markets. Advice, if any, is of a ‘general’ nature and not based on your personal objectives, financial situation or needs. Consider how appropriate the advice, if any, is to your objectives, financial situation and needs, before acting on the advice.
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