The dollar flew off against most major currencies on Wednesday after the Federal Reserve said it’s almost done of closing its monthly bond-buying program .The fed also assured that they have noticed changes in the labor market improvements, as a result ; the USD flew off against most currencies , however ; FOMC statement was expected but most likely not now (maximum by the end of this year ) , In all dollar strength was expected to happen , sooner or later , let’s highlight technical outlook for USDINDEX ?!!
The USDINDEX continued its bullish moment yesterday , printed support at the 85.23 levels , now focus will be on the key resistance 86.10 ?!
The USDINDEX will have to hold above the 86.10 levels on a daily closing basis to push the market for further upside gains , If seen , It will target 86.35 levels where a breach will turn focus on the 86.85 levels , a halt is likely ,but further upside will aim the 87.50/88.00 levels.
On the downside , a failure to hold above the 86.10 levels could mean a return to the 85.23 levels , a halt is likely , but losing the 85.23 levels on a daily closing basis , will reverse risk towards the 84.51 levels and possible lower towards the 84.00 levels.
In all , as long as support 84.23 holds on a daily closing basis , outlook in USDINDEX remains on the upside towards the 86.35/86.85 levels , below 85.23 will reverse risk towards the 84.50/84.00 levels.
Conclusion : Despite the positive US data yesterday , still early a bit to talk about big rise for the USD these days , yes , the USD is bullish in long term , but in medium term outlook remains neutral and under pressure , according to USDINDEX daily chart , the pair printed strong resistance levels at the 86.10 levels ahead of the 86.85 levels , a clear break above the 86.10 levels will build strong pressure on the 86.85 , to resume the whole rise from the 78.88 levels , a clear break above the 86.85 is needed , If seen , focus will be on the 90.00 levels.
If we combine technical analysis with fundamental view yesterday , USD gains could be limited , today focus will be on the US GDP (Q/Q) (Q3) , Initial Jobless Claims and Federal Reserve Chair Jannet Yellen speaks . Positive US data should advance the USDINDEX towards 86.85 levels while negative data could push the pair back towards the 85.23 levels.