The U.S. Dollar is rising against a basket of major currencies on Monday. The greenback is posting solid gains against the Euro, Japanese Yen, British Pound and Swiss Franc, while losing ground to the Canadian Dollar.
The Euro is struggling against the U.S. Dollar on early concerns over the May 23-26 elections for the new European Parliament. Position-squaring ahead of this week’s manufacturing and services PMI reports is also weighing on prices. Finally, the Euro could also be facing residual selling pressure from last week’s negative comments from Italian Deputy Prime Minister Matteo Salvini. The Euro tends to have the biggest influence on the dollar index because of its 57.6 percent weight.
Stronger oil prices are driving the Canadian Dollar higher against the U.S. Dollar.
Better-than-expected economic growth data failed to revive the Japanese Yen, which is losing ground to the dollar due to rising U.S. Treasury yields and increasing demand for higher risk assets. Sentiment could shift later in the session if U.S. stocks turn lower.
At 06:53 GMT, June U.S. Dollar Index futures are trading 97.865, up 0.041 or +0.04%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. Overtaking 97.865 earlier today change the trend to up. A move through 96.810 will change the minor trend to down. The nearest upside target is the April 26 top at 98.085.
On the downside, support is the retracement zone at 97.600 to 97.450.
Daily Technical Forecast
Based on the early price action, the direction of the June U.S. Dollar Index the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at 97.585.
A sustained move over 97.585 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to extend into the next downtrending Gann angle at 97.835. This is the last potential resistance angle before the 98.085 main top.
A sustained move under 97.585 will signal the presence of sellers. The daily chart indicates there is plenty of room to the downside with the next targets a Fibonacci level at 97.600, followed by a downtrending Gann angle at 97.085.
Crossing to the weak side of the angle at 97.085 will indicate the selling is getting stronger. This could trigger a further decline into the 50% level at .97.45, followed by an uptrending Gann angle at 97.435.
June U.S. Dollar Index traders should keep an eye on the Euro since it is heavily weighted in the index. The Dollar Index could weaken if the EUR/USD takes out 1.1164 and strengthen if the EUR/USD breaks through 1.1152.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Bitcoin Cash – ABC, Litecoin and Ripple Daily Analysis – 20/05/19
- Shanghai Index Down, Dow Futures Up Amid Confusion Over Report of Trade Talks Stalemate
- European Equities: It’s All Eyes and Ears on the Oval Office. What’s Next?
- Monero Technical Analysis – Support Levels in Play – 20/05/19
- GBP/USD Bearish Continuation After a Pullback
- EUR/USD Daily Price Forecast – Fiber Might Find Support Near 1.1135 Monthly Lows