Technical Analysis:
The DXY is trading around 103.84, approaching a crucial support level after recent downward pressure. Both the 50-period and 200-period Weighted Moving Averages (WMAs), positioned at 103.92 and 104.05 respectively, indicate resistance overhead, suggesting a bearish inclination. With the index near this level, traders are watching closely for potential breakouts or breakdowns.
A break below 103.84 could lead to further downside toward 103.50. Conversely, holding above this level might allow for a recovery, with resistance expected around 103.92 and 104.05.
Support: 🔻 103.84, 103.50
Resistance: 🔺 103.92 (50-WMA), 104.05 (200-WMA)
Moving Averages:
📉 The DXY is positioned below both the 50-WMA and 200-WMA, reinforcing a bearish outlook. A close above these averages could signal a shift in momentum, though sellers remain in control as long as the index stays below these points.
Volume:
📊 Trading volume has increased as the index nears the 103.84 support level, indicating active selling pressure. Sustained high volume on a break below could confirm further downside movement.
Key Levels to Watch:
Support: 🔻 103.84, 103.50
Resistance: 🔺 103.92 (50-WMA), 104.05 (200-WMA)
Outlook:
🚩 With the DXY under pressure near its support, a breakdown below 103.84 could signal additional losses. However, if it holds, we might see a short-term bounce, although resistance near the WMAs could limit any upward movement.
Fundamental Analysis:
The DXY continues to be influenced by U.S. economic data and global market sentiment, with focus on inflation trends and Federal Reserve policies. Investors remain cautious amidst economic uncertainty, with ongoing inflationary concerns impacting the outlook.
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