State of the market: the US currency near significant resistance

After the wave of recovery of the US dollar on the positive start of the European stock exchanges and correction, the US dollar index approached a significant resistance level of 89.80-90, which corresponds to the upper limit of the rising channel and the working level of the figure “double bottom”.

Against the backdrop of a highly controversial US data block, which showed a decline in the number of applications for unemployment benefits and a decline in business activity in March, the market and the US currency were in some uncertainty, which is exacerbated by the technical factors mentioned above.

On the formation of the reversal and the repulsion of the dollar index from the level of 89.90, one should expect further decline to the support level of 89.60-50. Otherwise, fixing above 89.90 will indicate the working off of the figure “double bottom” and will open the way to the levels: 90.10 and 90.20-30. It is also possible the third option with the formation of a flat near the level of 89.90-90.00, which will indicate the uncertainty of the market and a high probability of maintaining the existing downtrend.

Graph of the US dollar index. The current price is 89.90.

Hanzenko Anton