The US dollar surged after August’s upbeat retail sales took the market by surprise.
The greenback was bid up by a buying-the-dips crowd on the daily support (109.10) when the RSI showed an oversold situation. The indicator’s bullish divergence pointed to a loss in the sell-off momentum.
The break above the immediate resistance at 109.75 would prompt sellers to cover their positions. 110.15 is a key hurdle ahead and a bullish breakout may raise volatility and jump-start a new round of rally in the dollar.
