The dollar index is holding steady above 106.00 on Monday

The dollar index is holding steady above 106.00 on Monday

On Friday, the dollar index retreated to support at the 105.85 level. 

Dollar index chart analysis

On Friday, the dollar index retreated to support at the 105.85 level. The new higher low is a positive confirmation, and by the end of the day, we are back above the 106.00 level. Globally, the week was positive for the dollar as it held above the weekly open price.

During this morning’s Asian trading session, the dollar was under pressure, retreating to the 106.00 level from 106.10. We are successfully getting support there and starting a positive consolidation. The impulse pushes us above the weekly open price, and we are on a bullish path towards the 106.20 level. There, we should form a new daily high, which would confirm our bullish option. Potential higher targets are 106.30 and 106.40 levels.

Do we stay above 106.00 this week and go to a new high?

We need a negative consolidation and another drop below the 106.00 level for a bearish option on the dollar index. With that step, the index falls to a new daily low, confirming the bearish picture. After that, the trend should continue with the retreat of the dollar’s value. Potential lower targets are 105.90 and 105.80 levels. Additional support in the zone around 105.80 is the EMA200 moving average.

From today’s news, we highlight the Eurogroup meeting and, later, European Central Bank President Lagarde’s speech. From the US, we have nothing until tomorrow afternoon: S&P Global US Manufacturing PM, S&P Global Services PMI and New Home Sales. We have Australian Inflation and US Durable Goods Orders on Wednesday, and Thursday is earmarked for US Initial Jobless Claims.

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