The Dollar index remains under pressure early this week

Dollar index chart analysis

At the beginning of this week, the dollar index went bullish to 106.30. There, it encounters resistance, and we return to the initial level from the market’s opening. Additional pressure in that zone creates the EMA50 market average. The pressure moves to the 106.10 level, which could influence us to go down to 106.00 to test that zone. Last week, the dollar moved in the 106.00-106.70 range and managed to hold above the support zone.

Now we are again in that zone, which could expect new pressure and a breakthrough below. Potential lower targets are 105.90 and 105.80 levels. We need a positive consolidation and a jump to the 106.40 level for a bullish option. So we would jump over the support at 106.30 and form a new today’s high. We would also get support in the EMA50 moving average, and we would be able to test Friday’s high.

View of the dollar above 106.70 level

A break above would be a sign that the dollar has the strength to continue up to the 106.70 level and test last week’s resistance there. Potential higher targets are 106.80 and 106.90 levels. In continuation, the dollar would have a new opportunity to test the resistance zone from the beginning of October above the 107.20 level.

Today, we have no major economic news that could shake the dollar chart. Wednesday and Thursday will be interesting as we will have Bank of Canada and ECB interest rate decisions. At that time, we can expect larger movements on all major currency pairs.

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