US Dollar Index – Hovering between pivot and 100-day MA
The US Dollar Index is once again probing a 50% retracement level (72.85). The last time was the beginning of July when the 20-day MA halted the USD’s advance, eventually leading to a capitulation that has since based. More importantly, Thursday’s high of 73.02 is near the July rejection and at the exact same point where the April recovery struggled at before moving higher. These two rallies also have the same base points (71.31) and the same rally points (71.86). This implies that above 73.02 projects a test of 73.71 first (78.6% retracement & pivot resistance). We recommend buying the US dollar while price-action remains above the 100-day MA (72.56) for an extension towards 74.22 (June high & 200-day MA). Only below 71.86 (platform base) shifts momentum back to the downside.
Strategy Summary: LONG USDX AT 72.56 FOR 73.71 (1st TARGET), 74.22 (2nd TARGET), STOP AT 72.34….……….……………
SHORT EUR/USD AT 1.5740 FOR 1.5580 (1st TARGET), 1.5400 (2nd TARGET) STOP AT 1.5785
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