The dollar index closed last week on a bullish note against other major currencies having opened at 98.48, the upward rally in the Dollar can majorly be attributed to the expectation of a rate hike by the Feds in June.
Technical analysis:
Looking at the weekly chart, the index found support at the downward sloping trend-line 98.77 with a bullish weekly engulf candle. The index continues to trade within a triangle at immediate resistance of 100.39 and support at 98.48.
FOREX TECHNICAL OUTLOOK: DOLLAR INDEX
The oscillator indicator RSI 14 week period shows that the index is trading below the downward sloping trendine at 46.11 level.
Index currently holds above the SMA 100
On the daily timeframe, the index currently trades below the moving averages (SMA 100, EMA 20 and EMA 34).
Sentiment:
A break above 100.39 would most likely see a strong upside rally in the index towards key resistance of 103.65, on the other hand a weekly candle close below 98.77 would drive a bearish rally to critical support zone of 93.18 – 91.92
Happy Trading Week
GOLD POSE OPPORTUNITIES IN THE NEAR TERM
Having had a strong downward movement for three consecutive weeks ($1290.16 fall to $1228.08), the precious metal failed to continue the downward momentum as it finds support at the 1214 (demand trend-line on the daily timeframe).
The weekly candle shows indecision with a weekly Doji candle formation.
The down trend from 1290 halted at SMA100 therefore had a pull back to a high of $1231 per ounce. And RSI 14 day period continues to trade at the bearish territory
On the lower timeframe, 4 hours chart sees the precious metal continue to trade below the Moving Average and finds resistance at the EMAs 20 and 34.
What to look out for in the coming week:
A bearish candle close below SMA 100 and demand trend-line on the daily timeframe would set the pace for a fall to $1200 a psychological level for the precious metal. On the other hand, the metal trending up in the coming trading sessions would be seen as a corrective move within a triangle until there is a bullish close above the long term downward sloping trend-line.
Key levels to watch are resistance 12600, supports 1213 and 1200 .
