Tanalys

US Dollar Technical Analysis: Rally Shifts to Digestion Mode

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Talking Points:

The Dow Jones FXCM US Dollar Indexcorrected modestly lower after hitting the highest level in 14 months against its top counterparts. A daily close below the 14.6% Fibonacci retracementat 10874 exposes the 23.6% level at 10836. Alternatively, a turn above the 23.6% Fib expansion at 10919 clears the way for a test of the 38.2% threshold at 10976.

We remain broadly bullish on the US Dollar against its leading counterparts in line with ourlong-term fundamental outlook. As such, we remain long via theMirror Trader US Dollar currency basket.

Daily Chart – Created Using FXCM Marketscope 2.0

** The Dow Jones FXCM US Dollar Index and the Mirror Trader USD basket are not the same product.

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

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