USD Technical Outlook:
- WTI crude oil continues to rally within channel formation
- May be in for a pullback/consolidation, using channel as guide
US Dollar Technical Forecast for the Week Ahead: USD in Limbo
The US Dollar (DXY) is trying to keep itself in the game for a continued rally, but due to the general downtrend it faces the outlook is a bit uncertain. If the decline can halt soon (or if it already did on Friday), a short period of digestion might help firm up a base to continue higher. It won’t be long though before the descending 200-day MA will come into play, currently at 92.80.
The recent high at 92.50 and the 200-day are in rough alignment with a series of lows creating during the middle section of 2020. A climb above the 200 will have the DXY trading in open space above all meaningful resistance, opening up a path towards the 94s.
But before getting to that juncture there is a fair amount of work yet to be done. If the DXY continues to sink even a little lower, a bearish outlook will quickly grow legs. Until there is a bit more clarity the outlook appears neutral.
US Dollar (DXY) Daily Chart (can it hold its ground?)
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—Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX
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