Dollar index looks poised for a fifth straight day of gains

Technical Analysis

Author: Justin Low | usd

The last streak of gains similar to this was back in May

The dollar sold off yesterday after the release of the June CPI report, but there wasn't much to be too negative about and buyers lapped up the dips seen and the greenback closed the day on a more positive footing once again.

Since testing the 23.6 retracement level @ 93.81, the dollar index has been steadily moving higher and looks poised to test the resistance pocket just above the 95.00 handle once again.

The area between 95.15 (October high) and 95.53 (double-top this year) is proving to be a tough area to crack for buyers and will be once again another make or break test for dollar bulls.

It's been a quiet start to the day - as it was in the last two days as well - and previous sessions showed that the dollar remains well bid with a lack of key catalysts driving markets. The fact that the dip yesterday was quickly bought highlights that buyers are in control right now and momentum still points to the upside in the near-term.

I'd look for resistance around the 95.00 handle first before further tests between 95.15 to 95.53 being areas to exit/short. But should the 95.53 handle give way, expect the dollar index to fly as the rally will gain some wings.

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