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The US dollar index (DXY) bounces off its SMA-50

The DXY index bounces off its SMA-50 moving average

The US Dollar Index (DXY) is consolidating recent losses around 95.52, down 0.08% intraday early Thursday morning in Europe.

  • The DXY index is recovering from the intraday low during the two-day downtrend.
  • A sharp downside break of the short-term support line, pullback on the RSI keeps sellers hopeful.
  • The SMA-100 moving average, a five-week resistance line, adds to the bullish filters.

In doing so, the DXY Dollar Index bounces off the SMA-50 moving average but maintains the previous day’s downside break of a one-week support line, holding a resistance line around 95.66.

Given the negative sloping RSI line, theDXY index should remain weak even if it manages to clear the immediate trend line hurdle at 95.66.

That said, the SMA-100 moving average and a descending resistance line from December 15, around 95.75 and 96.10 respectively, become the main challenges for the US dollar index.

Alternatively, a sharp break down from the 95.40 SMA-50 moving average level will not hesitate to challenge the 94.62 monthly low.

Note that the 95.00 threshold will provide an intermediate stop during the drop between 95.40 and 94.62, while the October high of 94.56 acts as an additional filter to the south.

In short, the US Dollar Index (DXY) remains bearish despite the recent corrective pullback from the intraday low.

Dollar Index (DXY) 4 hour chart

Trend: further weakness expected

Par Anil Panchal, FXStreet

He worked with Edelweiss Financial Advisors Ltd from 2007 to 2013 as a research analyst for the commodities sector. Anil subsequently joined Admiral Markets from April 2013 to January 2019, where he worked as a Forex analyst. Job roles at both locations were to follow macroeconomics and perform fundamental and technical analysis of commodities and the foreign exchange market, respectively. At FXStreet, he mainly writes asset/tech news articles on various currency pairs, commodity pairs, and even some stock markets. It also helps provide macro/event data summaries and bank reports when needed.

forex broker avatrade 970The opinions expressed herein are solely those of the author and do not necessarily reflect the views of Forex Quebec. Every investment and trading move involves risk, you should do your own research when making a decision.

Disclaimer: The information and opinions contained in this report are provided for general information only and do not constitute an offer or solicitation to buy or sell foreign exchange contracts or CFDs. Although the information contained in this document has been obtained from sources believed to be reliable, the author does not guarantee its accuracy or completeness, and assumes no liability for direct, indirect, or consequential damages that may result from anyone’s reliance on such information. .

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