US Dollar Bulls Push Prices Towards Resistance
- US Dollar Prices Advance Late Friday Against the Euro and Pound
- USDollar Trendline Resistance is Found Near 11,980
- A Breakout Below 11,798 Exposes Yearly Lows at 11,672
US Dollar bulls regained control of the market Friday afternoon, and now the USDOLLAR Index is set to close higher for the week. This reversal in price action late marks a significant shift in momentum, as the Index had initially continued to sell off after last week’s momentous NFP miss. Next week traders will be watching for Retail sales figures on Tuesday. This event is event is forecasted at 0.4% and depending on the outcome may directly influence the US Dollars move against other major currency pairs.
Looking for additional trade ideas for trading the US Dollar? Check out our Trading Guide
USDOLLAR Daily Chart
(Created using Marketscope 2.0 Charts)
Technically, the US Dollar Index continues to trade in a daily downtrend. However, prices have not printed a new Daily low from the year, since the May 2016 low of 11,672. Currently, price action is testing the most recent value of resistance near 11,902. This area is represented graphically as a 50% retracement in price from the May 2016 high at 12,006 to the most recent swing low at 11,798. If price action breaks through this point of resistance, it opens up the US Dollar Index to test descending trend line resistance found near 11,980.
Alternatively, if price action reverse at current resistance, it opens price action to resume trending downward. In this scenario, traders should look for the US Dollar to test the June swing low previously mentioned at 11,798. A move to this value would be synonymous with the US Dollar rallying against major currency pairs including the EUR/USD and GBP/USD.
To Receive Walkers’ analysis directly via email, please SIGN UP HERE
See Walker’s most recent articles at his Bio Page.
Do you know the biggest mistake traders make? More importantly, do you know how to overcome the biggest mistake? Read page 8 of the Traits of Successful Traders Guide to find out [free registration required].
Contact and Follow Walker on Twitter @WEnglandFX.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.