A drop to 89.50 is still within the possibilities

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  • The DXY failed to extend the recent bullish attempt beyond 90.60.
  • The bearish leg could lead to a test of the May lows at 89.50.

The US Dollar Index (DXY) is sailing without a clear direction at the lower limit of the recent range and following the decline following Friday’s employment report.

If the selling momentum picks up, then a retest of the 90.00 zone should emerge on the horizon in the near term. A breakout should open the door for a deeper pullback towards the May low near 89.50.

Meanwhile, and looking at the broader scenario, as long as it remains below the 200-day SMA today at 91.61, the outlook for the dollar is forecast to remain negative.

DXY day chart

DXY

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