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19 Jun 2013
US Dollar Index continues to hover around 81.00
FXstreet.com (Barcelona) -After trading as high as 81.15 at one point in the day, the DXY was unable to hold onto early gains and finished flat for a second day in a row at 80.80. Thus far, the greenback has been able to find firm support near the 80.70 level on numerous occasions the past 4 trading days.
FOMC Meeting to influence price action
David Song, Currency Analyst at DailyFX went on to discuss the upcoming FOMC meeting, and how it might influence the greenback as we progress throughout the rest of the week. "As the Federal Open Market Committee interest rate decision takes center stage, the major currencies may consolidate ahead of the key event, but the fresh batch of central bank rhetoric along with the updated forecast is likely to heighten the appeal of the USD should we see a growing argument to taper the asset-purchase program.”
In further discussing the FOMC Meeting Song commented, “Indeed, it seems as though the FOMC is slowly moving away from its easing cycle as the U.S. economy gets on a more sustainable path, and the central bank may start to lay out a more detailed exit strategy as the committee sees a stronger recovery in the second-half of the year.” Song concluded by mentioning the shift in Fed policy should help to provide a firm bid to the USD as we progress throughout the remainder of the year.
Technical picture on DXY still bearish
The current technical set up on the DXY daily chart remains in bearish set up. Price remains below both the 9 and 20dma’s on the daily chart, while the RSI (14) continues to consolidate below the 40 level and maintain the bearish zone between 20 and 60. Initial support sits at 80.70 (noted above), followed by 80.40 (support on daily chart). Initial resistance remains at 81.25 (the 9dma), followed by 81.50 (the 200dma).
FOMC Meeting to influence price action
David Song, Currency Analyst at DailyFX went on to discuss the upcoming FOMC meeting, and how it might influence the greenback as we progress throughout the rest of the week. "As the Federal Open Market Committee interest rate decision takes center stage, the major currencies may consolidate ahead of the key event, but the fresh batch of central bank rhetoric along with the updated forecast is likely to heighten the appeal of the USD should we see a growing argument to taper the asset-purchase program.”
In further discussing the FOMC Meeting Song commented, “Indeed, it seems as though the FOMC is slowly moving away from its easing cycle as the U.S. economy gets on a more sustainable path, and the central bank may start to lay out a more detailed exit strategy as the committee sees a stronger recovery in the second-half of the year.” Song concluded by mentioning the shift in Fed policy should help to provide a firm bid to the USD as we progress throughout the remainder of the year.
Technical picture on DXY still bearish
The current technical set up on the DXY daily chart remains in bearish set up. Price remains below both the 9 and 20dma’s on the daily chart, while the RSI (14) continues to consolidate below the 40 level and maintain the bearish zone between 20 and 60. Initial support sits at 80.70 (noted above), followed by 80.40 (support on daily chart). Initial resistance remains at 81.25 (the 9dma), followed by 81.50 (the 200dma).