The US Dollar Index is testing immediate support at a four-month low of 103.34, having recorded a recent trading level around 103.60 during Asian hours on Thursday. The 14-day RSI is below 30, indicating oversold conditions, while the index remains below the nine- and 50-day Exponential Moving Averages, reflecting a bearish trend.
Should the index break below 103.34, it could potentially decline to 103.00, with further bearish momentum pushing towards a five-month low of 100.68. Conversely, initial resistance is at the nine-day EMA of 104.34, and a move past this level could lead to increased upward momentum, targeting the 50-day EMA at 106.44 and the upper boundary of the descending channel at 106.70.
Dollar Performance Against Other Currencies
The percentage changes of the US Dollar against other major currencies show it is strongest against the Australian Dollar. The data presents movements among various currencies, with notable fluctuations against the Euro and Japanese Yen.
What we are seeing is a dollar that appears to be struggling, at least in the short term. With momentum indicators placing it in oversold territory, there is pressure on the downside, but this also suggests the potential for a temporary rebound.
If the US Dollar Index drops through 103.34, there is room for further weakness, with 103.00 acting as the next level of interest. Beyond that, the prospect of a fall to 100.68 would reflect much broader softness. As it stands, the price sitting below both the nine-day and 50-day moving averages aligns with continued bearish sentiment. Traders watching for a shift in momentum may look at 104.34 as the first real test. Should the index push above this point, it could open the door towards the next resistance levels at 106.44 and 106.70.
Market Reaction And Volatility
Currency movements relative to the US Dollar suggest particular weakness in some areas, notably against the Australian Dollar, while fluctuations against the Euro and Yen should not go unnoticed. What matters now is how price reacts at key levels, particularly as volatility picks up.
