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Technical Analysis – US dollar index could retest 105.60

  • US dollar index holds above short-term SMAs

  • MACD and stochastics indicate upside momentum

The US dollar index bounced off the 103.60 support level and jumped above the short-term simple moving averages (SMAs), remaining within an upward sloping channel in the medium-term picture.

According to technical oscillators, the MACD is standing above its trigger and zero lines, while the stochastic oscillator recorded a bullish crossover within its %K and %D lines slightly below the 80 level.

Immediate resistance could come from the 105.60 barricade ahead of the 106.35 peak, achieved on May 1. Even higher, the eleven-month high of 107.00 could attract traders’ attention.

On the flip side, a decline below the SMAs and especially beneath the ascending trend line may switch the short-term bias to neutral, meeting the 103.60 support again. A dive below this level may take the bears until 102.80.

In brief, the dollar index has a clear upside direction in the long-term view, despite the ups and downs in the ascending channel.

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