The dollar index on wings above 104.00 after Friday’s news

Dollar index chart analysis

On Friday, after good economic news, the dollar index jumps from 102.90 to 104.00, closing the trading week at that level. During the Asian trading session, it managed to stay above the 104.00 level, which later generated a new bullish impulse and growth to 104.28 levels. The dollar thus forms a new two-month high and this year’s high. Now, we need to see how the dollar will use this momentum.

The beginning of the week is promising, and we could expect a jump and growth of the dollar to higher levels in the coming days. Potential higher targets are 104.30 and 104.40 levels. For a bearish scenario, we need a negative consolidation and pullback to 104.00 this morning’s support level. New pressure could easily push the index lower in search of new support. Potential lower targets are 103.80 and 103.60 levels.

Can the dollar index stay this high for the rest of the week?

On Friday, after the announcement of positive news for the NFP report and the unemployment rate, the dollar jumped above 104.00 with a strong impulse. In the previous days, the picture was totally different, and we saw the dollar under pressure and many tests of the EMA200 moving average.

We will have a lot less economic news this week. In addition, news from the US market will dominate. For Monday, we highlight Services PMI and ISM Non-Manufacturing PMI. Early on Tuesday, the RBA will announce the future interest rate for the Australian dollar. The forecast is that the interest rate will remain at the same level as before, at 4.35%. And for Friday, we highlight the German CPI, which could determine the course of the European economy.

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