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Technical Analysis – Dollar index storms to fresh 10-month high
October 3, 2023 3:27 pmVideo
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The US dollar index (December Futures) has been in a steady recovery after bouncing off the 2023 low of 99.19 in July. Even though the relentless rally has resulted in a fresh 10-month peak in today’s session, the momentum indicators currently suggest that the advance could be overstretched.
Should positive momentum intensify further, the bulls could initially attempt to conquer the 50.0% Fibo of 106.95. Jumping above the latter, the dollar index could then test the 61.8% Fibo of 108.78. Even higher, the 78.6% Fibo of 111.39 may curb further upside.
On the flipside, if bearish forces re-emerge and put an end to the recent rebound, the 38.2% Fibo of 105.12 could be the first obstacle for the price to overcome. Dipping below that level, the index could descend towards the 23.6% Fibo of 102.85. Further declines could then cease at the 2023 bottom of 99.19.
Overall, the US dollar index appears to be staging a solid comeback, edging higher to consecutive multi-month highs. However, a downside correction should not be ruled out as the latest advance has reached overbought conditions.
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