After a month, the dollar index is back at the 104.00 level
Yesterday’s published data on US inflation dropped the dollar index to 104.00.
Dollar index chart analysis
Yesterday’s published data on US inflation dropped the dollar index to 104.00. The data showed a decrease in inflation, which had a negative impact on the dollar. After the formation of the July low, the index started a recovery up to 104.54. During this morning’s Asian trading session, we did not have enough strength to move above 104.00, so a new daily high was formed.
The dollar index started a new retreat from that zone and is now at 104.35. Pressure is on the support zone, and an impulse below and a test of yesterday’s low could easily happen. Potential lower targets are 104.20 and 104.00 levels. The June low dollar index was at the 103.99 level.
The dollar continues to fight bearish pressure and holding above 104.00
We need a positive consolidation and a return above the 104.50 level for a bullish option. Then, it is necessary to stabilize there for some time to form the bottom from which to start conquering higher levels. Potential higher targets are the 104.60 and 104.70 levels. If the index moves above the 104.70 level, additional support could be found in the EMA 50 moving average.
From today’s economic news, we highlight the following: French CPI and Chinese New Loans report. Eurogroup Meetings are also being held today, which could affect the movement of the euro. In the US session, we highlight the Producer Price Index report, followed by the Canadian Building Permits and the US. Baker Hughes Total Rig Count. Next week, we will have new speeches by Jerome Powell, chairman of the Fed, which will affect the movement of the dollar index.
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