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

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