Potential for Top in USDOLLAR After Triangle False Breakout
- USDOLLAR made new highs this week, but has reversed breakout.
- Failure under daily 34-EMA - support since July - would confirm.
- See the April forex seasonality report.
Although the USDOLLAR Index hit fresh yearly highs this week, it's now vulnerable to setting a significant top if it breaks current levels. The daily 34-EMA has been the backbone of trend support dating back to last July (having most recently served as support on the post-March FOMC meeting selling), and a loss of this mean reverting level, in context of the recent return to the triangle range, would indicate strong potential for lower prices in USD-pairs over the coming days and weeks.
--- Written by Christopher Vecchio, Currency Strategist
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