The dollar index edged lower from one month high on Friday, but remains constructive, as the latest bullish acceleration broke and establishes above psychological 100 level, which repeatedly capped attacks in past three weeks.
The dollar is also on track for the third consecutive weekly gain that contributes to signals of possible stronger recovery.
Profit-taking from sharp fall in past three months lifted the dollar’s price, with brightening outlook after the US reached trade deals with a number of large economies and signals of talks with China, adding to supportive factors, along with the latest remarks from US policymakers that persisting uncertainty would continue to offset expectations for rate cuts in coming months.
The recovery is supported by formation of bear trap pattern (under 98.92 Fibo support) on weekly chart, with improving technical picture on daily chart (strengthening positive momentum / 10/20 DMA turned to bullish setup and formed a bull-cross) although more work at the upside will be required to verify positive signals.
Weekly close above 100 level (psychological / near Fibo 38.2% of 104.30/97.65 bear-leg) will be the minimum requirement to keep alive optimisms for further recovery, with lift above 100.97 (50% retracement) to validate bullish signal.
Res: 100.69; 100.97; 101.76; 102.00.
Sup: 100.19; 100.00; 99.22; 98.85.
