The dollar index consolidating above new two-month low, posted after a sharp fall in past two days.
The greenback was deflated by renewed risk appetite, while weak latest economic data from the US suggest that economic conditions are fragile and suggest that the Fed likely near the end of its tightening cycle that makes the US currency less attractive for investors.
Markets will continue to closely watch the US data to get more clues about economic growth, particularly due to the banking stress, which would strongly influence dollar’s performance, as the latest crisis in the sector faded, but many remain very cautious regarding this problem.
The latest drop marked retracement of the most of 100.66/105.85 rally and pushed the price close to key support at 100.66 (2023 low), with the action being additionally supported by bearish daily studies.
However, oversold conditions on daily chart signal that larger bears may take a breather and consolidate before final push towards 100.66 and 100.00 (psychological) in extension.
Upticks are expected to stall under falling 10DMA (102.02) to offer better opportunities to re-enter larger bearish market.
Only lift above 102.73/78 (Monday’s top / falling 20DMA) would sideline bears and open way for stronger correction.
Res: 101.53; 101.88; 102.02; 102.64
Sup: 101.12; 100.66; 100.00; 99.30
