US Dollar

U.S. Dollar Index (DX) Futures Technical Analysis – Bullish Minutes Should Trigger Rally into 90.925

The U.S. Dollar is trading slightly higher against a basket of major currencies shortly after the mid-session on Wednesday as investors await the release of minutes from the Federal Reserve’s last policy meeting.

The greenback is getting no help from Treasury yields, which are trading flat. This suggests the strength is coming from position-squaring or profit-taking. However, do to the steep drop in U.S. equities, it is possible that we are seeing some safe-haven buying.

At 17:30 GMT, June U.S. Dollar Index futures are trading 89.895, up 0.161 or +0.18%.

Minutes from the Federal Open Market Committee’s meeting in April are due to be published at 18:00 GMT. Investors will be poring over the meeting minutes for any indication as to the Fed’s views on rising inflation and when it might start to tighten its easy monetary policy.

Daily June U.S. Dollar Index

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 90.910 will change the main trend to up. A move through 89.675 will reaffirm the downtrend.

The minor range is 90.910 to 89.675. Its 50% level at 90.295 is the first upside target.

The short-term range is 91.435 to 89.675. Its retracement zone at 90.555 to 90.765 is the next potential upside target and resistance area.

Daily Swing Chart Technical Forecast

The direction of the June U.S. Dollar Index into the close on Wednesday will likely be determined by trader reaction to 89.735.

Bullish Scenario

A sustained move over 89.735 will indicate the presence of buyers. If this creates enough upside momentum then look for the buying to possibly extend into the first pivot at 90.295. Taking out this level will indicate the buying is getting stronger with 90.555 to 90.765 the next target area.

Bearish Scenario

A sustained move under 89.735 will signal the presence of sellers. The next target is 89.675, followed closely by the February 25 main bottom at 89.655. This is a potential trigger point for an acceleration to the downside with the January 6 main bottom at 89.155 the next likely target.

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Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.