US Dollar Index: Support Test Near 100 Appears Likely
2024.09.26 08:08
Yesterday, we saw some interesting reversals on pairs during the US session after the US housing data was released. It’s notable that the dollar is up despite higher stocks, which continued to push higher through the Asian session when we saw strong gains, driven mainly by Chinese equities, as China took policy actions to stimulate their economy.
Looking at the on the hourly time frame, we can see that an ongoing ending diagonal is forming. So sooner or later we will see a larger degree correction, as those wedge patterns typically occur at the end of a trend. This means that at some point a-b-c rally could take the Dollar Index back toward the 101.60–102.00 resistance area.
However, there’s still a chance that the 100 level could be retested first, especially if stocks continue to rise today. Keep in mind that later today, we have speeches from Powell and Lagarde, so the dollar could experience some volatility.
