- After correcting at the previous 2 year trend line and 200 day MVA, the dollar has found support at the 0.382 Fibonacci retracement. If you take a look back over the past couple years, this has been an area of pivotal support/resistance numerous times. I expect a bounce from this level to retest and possibly even break the previous trend line as long as the RSI remains bullish( > 50).
- From a fundamental perspective, it could be assumed that the USD will be moving downward given the ultra dovish initial commentary from Yellen. This is definitely a risk, but considering all the voting FOMC members views on QE, there is more of a consensus that the taper should have already begun.
- Cyclical, with an insanely overbought equities market, I expect profit taking through the end of the year to further support the USD. As always this is only what I view as the most likely scenario. The alternative scenario should still see the DXY finding support at its most previous swing low.
- From a fundamental perspective, it could be assumed that the USD will be moving downward given the ultra dovish initial commentary from Yellen. This is definitely a risk, but considering all the voting FOMC members views on QE, there is more of a consensus that the taper should have already begun.
- Cyclical, with an insanely overbought equities market, I expect profit taking through the end of the year to further support the USD. As always this is only what I view as the most likely scenario. The alternative scenario should still see the DXY finding support at its most previous swing low.