Dollar Index Analysis (USDX)
- The dollar index has seen an upside continuation after forming a bullish engulfing line – as highlighted in the post FOMC update. USDX went as high as 80.00 which is part of a larger price pivot zone.
- EURUSD (with a 57.60% weighting in USDX) is trading over the 1.300 psychological level, 1.300 is likewise also a major price pivot when referencing recent data. A drop into 1.300 area support may again see demand.
- Conversely, sustained EURUSD upside may not be in-line with prevailing market sentiment. The medium term EURUSD bias appears to be lower (USDX higher) – range-bound price action may be seen beforehand around 1.300.
- Potential dollar index resistance levels are seen at 80.00 (R1), 80.75 (R2) and 81.77 (R3). Possible support levels are 79.60 (S1), 79.32 (S2) and 78.70 (S3).
USDX Daily Chart