USD lacks conviction as resistance approaches
Technical outlook in USD:
- The US dollar index (DXY) has a small margin of progress before resistance
- Low volatility results in a lack of conviction in movements both higher and lower
US Dollar Technical Forecasts: USD Lacks Conviction As Resistance Approaches
The US dollar according to the DXY has been quite strong lately and continues to look poised for higher levels in the near term. However, given the generally low volatility and the propensity to slow down after short periods of trending, resistance ahead may prove too difficult to overcome.
There is the August high at 93.72 and an upper March trendline preventing the DXY from moving further from here. We could see a full test develop in the coming days, so it will be essential to monitor the behavior of price action. A reversal of momentum can initiate a reversal.
On the other hand, if we see a surprising rise in momentum as resistance is reached and broken out, then perhaps a prolonged rise could develop towards the important area of ââ~ 94.65. In this scenario, we will still need to watch closely for signs of a stall, as new highs and lows have not always been able to hold up.
US Dollar Daily Chart (DXY)
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— Written by Paul Robinson, Market Analyst
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