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U.S. Dollar Index Futures (DX) Technical Analysis – Uptrend Resumes on Breakout Over 98.005

By:
James Hyerczyk
Published: Feb 3, 2020, 19:09 UTC

Improving risk sentiment drives up U.S. Dollar, while pressuring the safe-haven Yen and Swiss Franc.

U.S. Dollar Index Futures (DX) Technical Analysis – Uptrend Resumes on Breakout Over 98.005

The U.S. Dollar is trading higher against a basket of major currencies at the mid-session on Monday. The greenback is posting solid gains against the Euro, British Pound, and Canadian Dollar as well as the safe-haven Japanese Yen and Swiss Franc.

The Euro is being pressured as Euro Zone factory activity contracted again in January but did so at its shallowest rate since mid-2019, according to a survey which suggested the worst may be over for the bloc’s battered manufacturing industry, according to Reuters.

IHS Markit’s final manufacturing Purchasing Managers’ Index rose to a nine-month high of 47.9 in January, just above a preliminary reading of 47.8 and edging closer to the 50 mark that separates growth from contraction. It came in at 46.3 in December.

At the mid-session on Monday, March U.S. Dollar index futures are trading 97.625, up 0.412 or +0.42%.

The safe-haven Yen and Swiss Franc retreated as risk sentiment improved and fears about the coronavirus eased after China took measures to cushion the impact of the new epidemic and pledged to do more to contain it and support the country’s financial markets.

Daily March U.S. Dollar Index

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 98.005 will signal a resumption of the uptrend. The main trend will change to down on a move through 96.815.

On the upside, the key retracement zone to watch is 97.380 to 97.700.

On the downside, potential support levels come in at 97.270, 97.015 and 96.780.

Daily Technical Forecast

Based on the early price action and the current price at 97.625, the nearest uptrending Gann angle comes in at 97.505, followed by a support cluster at 97.395 to 97.380.

On the upside, the first resistance is the Fibonacci level at 97.700, followed by a pair of downtrending Gann angles at 97.820 and 97.910. The latter is the last potential resistance angle before the 98.005 main top.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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