US Dollar on Verge of Meaningful Breakdown

| August 12, 2017

From an intermediate-term perspective, the US Dollar index has been moving sideways since early 2015, forming a consolidation pattern following the strong rally in 2014. The congestion support in the 93 area has been tested several times since then, but the current downtrend from the beginning of the year is attempting to move below that key support level, and technical indicators on the weekly chart are bearish overall, strongly favoring additional losses moving forward.

However, the latest intermediate-term cycle low (ITCL) is overdue and it could form at any time, so cycle analysis suggests that there is still a chance that the 93 support level could hold once again.

A weekly close well below the 93 level would constitute a confirmed breakdown and forecast substantial additional losses, so it will be important to monitor the index closely during the next few weeks.

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Category: Commentary, Market Update


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