US Dollar Bulls Hold Critical Support Zone

US DOLLAR PRICE OUTLOOK: USD BULLS DEFENDING KEY TECHNICAL SUPPORT LEVEL

US Dollar volatility accelerated on Monday because the Buck staged a giant intraday reversal
DXY Index recoiled increased as US Greenback bulls preserve defending a key technical help degree
USD worth motion may proceed to fluctuate throughout the confines of its broader buying and selling vary

The US Greenback inked an enormous intraday reversal throughout Monday’s buying and selling session. USD worth motion declined a notable -0.4% as measured by the broad-based US Greenback Index early on, however following the discharge of a powerful US PMI report, the Buck subsequently staged an eye-popping rally to complete the day up about 0.2% on steadiness. The inflow of US Greenback power additionally seems to coincide with a rebound off a crucial technical support degree as bulls proceed to defend the 92.00-handle on the DXY Index.

DXY – US DOLLAR INDEX PRICE CHART: MONTHLY TIME FRAME (FEB 2011 TO NOV 2020)

Chart by @RichDvorakFX created utilizing TradingView

A giant-picture have a look at the US Greenback Index utilizing month-to-month candlesticks brings to focus a longstanding bullish trendline prolonged via the Could 2011 and Could 2014 swing lows. USD promoting strain for the reason that March 2020 swing excessive stays a prevalent theme, however US Greenback bulls have stood their floor and stored the Buck largely afloat round this key technical zone.

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Along with its decrease Bollinger Band, this potential space of buoyancy can be highlighted by the 38.2% Fibonacci retracement of its Could 2011 to January 2017 buying and selling vary. A clear break beneath this help degree across the 92.00-mark may open the door to extra US Greenback draw back – maybe towards the 2018 swing lows. However, it appears extra doubtless that the US Greenback Index may proceed alongside its turbulent drift sideways with the 50-day simple moving average close to the 93.30-price standing out as a possible degree of resistance.

USD PRICE OUTLOOK: US DOLLAR IMPLIED VOLATILITY TRADING RANGES (1-WEEK)

Be taught Extra – What is Implied Volatility & Why Should Traders Care?

GBP/USD is anticipated to be probably the most lively major currency pair this week in accordance with US Greenback implied volatility readings simply taken. This doubtless follows rising prospects for UK officers to announce a long-awaited Brexit commerce deal. Maintaining a tally of the course of EUR/USD and USD/JPY all through the week may be prudent seeing that their respective 1-week implied strikes of 87-pips and 78-pips may underestimate realized volatility – notably contemplating the acceleration in US Greenback volatility on Monday.

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