Back
14 Aug 2013
DXY completes “abc” pullback on 60-minute chart after big ups Tuesday
FXstreet.com (Barcelona) - The US Dollar Index (DXY) may move higher after putting in a textbook “abc” or “zig-zag” downside correction Tuesday.
DXY blows off good European and so-so US data to move higher
Better German data plus good European data plus only so-so US data Tuesday equals a lower DXY, right? Wrong!! The 10-Year US Treasury Note ripped to the upper edge of the recent trading range at 2.7% Tuesday and the DXY followed suit by rallying sharply – despite the tone of the data flow.
The DXY rallied throughout the day Tuesday until 15:05 GMT where what appears to have been a textbook “abc” correction to the downside began. That correction played out until around 19:25 GMT when the next potential short-term up wave began. The DXY is currently off the 19:25 GMT pivot low of 81.70 at 81.76.
Technical outlook for the DXY
Technicians have been saying the downside trading target for DXY is likely 80.51 – 80.66 after 81.13 support was broken last week. Once the anticipated low is established, technicians are calling for a sharp move to the upside with an ultimate target of at least 85.00 – which will likely correspond with the Fed’s tapering program. Shorter-term resistance for DXY comes in at the 7/24 peak at 82.42.
DXY blows off good European and so-so US data to move higher
Better German data plus good European data plus only so-so US data Tuesday equals a lower DXY, right? Wrong!! The 10-Year US Treasury Note ripped to the upper edge of the recent trading range at 2.7% Tuesday and the DXY followed suit by rallying sharply – despite the tone of the data flow.
The DXY rallied throughout the day Tuesday until 15:05 GMT where what appears to have been a textbook “abc” correction to the downside began. That correction played out until around 19:25 GMT when the next potential short-term up wave began. The DXY is currently off the 19:25 GMT pivot low of 81.70 at 81.76.
Technical outlook for the DXY
Technicians have been saying the downside trading target for DXY is likely 80.51 – 80.66 after 81.13 support was broken last week. Once the anticipated low is established, technicians are calling for a sharp move to the upside with an ultimate target of at least 85.00 – which will likely correspond with the Fed’s tapering program. Shorter-term resistance for DXY comes in at the 7/24 peak at 82.42.