25 Jul 2013
DXY bounced sharply Wednesday but remains under 82.42 resistance
FXstreet.com (Barcelona) - The US Dollar Index (DXY) rallied Wednesday on the positive energy created by better-than-expected US Manufacturing PMI and home sales data. It fell short, however, of overtaking support-turned-resistance at 82.42.
Better US data rejuvenated an oversold DXY – at least for a day
After nearly two weeks of persistent selling pressure, the DXY finally caught a bit of a tailwind from higher-than-expected new home sales and a better-than-expected Manufacturing Purchasing Managers Index. The data broke a modest streak of somewhat disappointing economic news emanating from the US over the last two weeks.
The DXY immediately rallied following the housing data and continued to build on those gains later in the session Wednesday. The rally did seem to peter out, though, once the previous support / new resistance at 82.42 was approached.
Technical outlook for the DXY
Technicians are calling for an eventual move in the DXY down to around the 80.71 level before the current macro correction is over. However, an oversold reading combined with Wednesday’s data to provide a brief relief rally during the second half of Wednesday’s session. Short-term resistance for the DXY comes in at the 82.42 level and is followed by the closing high from 7/15 of 83.04. Short-term support for DXY comes in at Tuesday and Wednesday’s lows of 81.93 with the 5/1 closing low at 81.48 below that.
Better US data rejuvenated an oversold DXY – at least for a day
After nearly two weeks of persistent selling pressure, the DXY finally caught a bit of a tailwind from higher-than-expected new home sales and a better-than-expected Manufacturing Purchasing Managers Index. The data broke a modest streak of somewhat disappointing economic news emanating from the US over the last two weeks.
The DXY immediately rallied following the housing data and continued to build on those gains later in the session Wednesday. The rally did seem to peter out, though, once the previous support / new resistance at 82.42 was approached.
Technical outlook for the DXY
Technicians are calling for an eventual move in the DXY down to around the 80.71 level before the current macro correction is over. However, an oversold reading combined with Wednesday’s data to provide a brief relief rally during the second half of Wednesday’s session. Short-term resistance for the DXY comes in at the 82.42 level and is followed by the closing high from 7/15 of 83.04. Short-term support for DXY comes in at Tuesday and Wednesday’s lows of 81.93 with the 5/1 closing low at 81.48 below that.