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US Dollar (DXY) Posts a Fresh 16-Month High Ahead of a Cluster of Fed Speakers


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US Dollar Price, Chart, and Analysis

  • US dollar basket spikes above 96.00.
  • Multiple Fed speakers on the docket.

US dollar wallows and stocks inch higher as stimulus eyed | The Edge Markets

 

The yield on the benchmark US 10-year US Treasury is currently testing a fresh one-month high around 1.65% with traders eyeing the mid-March 1.73% yield level as the next target. While the latest move higher in yields may need to be consolidated to move DXY out of heavily overbought territory – see below – the medium-term outlook for the dollar remains positive.

The strength of the greenback is visible across a range of USD-pairs, notably the Euro and the Japanese Yen. EUR/USD recently posted a new 16-month low, while USD/JPY this week hit a high not seen since March 2017.

Euro (EUR) Price Outlook: No End Yet in Sight for EUR/USD Weakness

IG sentiment data show how retail clients are currently positioned and how these positions have changed over the past week.

A look at today’s DailyFX Calendar shows seven Fed speakers on tap later in the session with more to follow during the rest of the week. Keep up to date with all market-moving data releases, events, and speeches by using the DailyFX Calendar

Today’s Fed Speakers – November 17, 2021

US Dollar (DXY) Posts a Fresh 16-Month High Ahead of a Cluster of Fed Speakers

A look at the daily US dollar basket chart shows DXY sitting in heavily overbought territory – using the CCI indicator at the bottom of the chart - after the sharp advance in the greenback over the past few days. The USD has made a strong break above trend resistance and is over 2 big figures higher since last Wednesday. The weakness in the Euro – the single currency has a 57%+ weighting in the US dollar basket - has helped the move, but the greenback remains strong in its own right with the macro backdrop of soaring inflation underpinning the move higher. There is likely to be a period of consolidation in the short-term but with so many Fed speakers on the slate, any hawkish twists could see the greenback attempt another leg higher.

US Dollar (DXY)Daily Price Chart November 17, 2021

US Dollar (DXY) Posts a Fresh 16-Month High Ahead of a Cluster of Fed Speakers

 

What is your view on the US Dollar – bullish or bearish?

 

By Nick Cawley, Strategist, 17th November 2021. DailyFX

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      EUR/CHF made a 7.5-year low at the end of last month at 0.9699, moving below the previous low of 0.9804.

      Since breaking lower, the price has not managed to reclaim 0.9804 and it may continue to offer resistance. The 21-day Simple Moving Averages (SMA)is currently at that level, potentially adding resistance.

      Further up, the recent peak of 0.9957 might offer resistance ahead of the break point at 0.9973.

      In the last session, the price has crossed below the 10-day SMA and remains below the 21-, 55-, 100- and 200-day SMAs.

      A bearish triple moving average (TMA) formation requires the price to be below the short term SMA, the latter to be below the medium term SMA and the medium term SMA to be below the long term SMA. All SMAs also need to have a negative gradient.

      Looking at EUR/CHF, the criteria for a bearish TMA has been met and may indicate that bearish momentum could evolve further.

      Support might be at the recent low of 0.9699 or further down at the 161.8% Fibonacci Extension of 0.9638.

       

      Chart created in TradingView 

      USD/CHF TECHNICAL ANALYSIS

      USD/CHF has bounced off low made at the start of this month at 0.9470 to trade in a wide range of 0.9545 – 0.9650. These levels might provide support and resistance respectively.

      While the price is below all short-, medium- and long-term Simple Moving Averages (SMA), they have positive and negative gradients. This may suggest a lack of conviction for directional momentum that might see further range trading.

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      The recent low of 0.9470 may provide support ahead of the break point at 0.9460. On the topside, resistance might be at the break point of 0.9710 or the July peak of 0.9886.

       Chart created in TradingView

      Daniel McCarthy, Strategist Daily FX

      Source: Daily FX
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