Dollar pulls back after soft data
EURUSD entered into bearish territory a couple of months ago and after a strong run for the dollar, the pair finally found support around 1.17, where it bottomed at the end of March.
The UoM consumer sentiment survey fell to its lowest in a decade on Friday which appeared to encourage further profit taking in the greenback and, while it has pared losses a little today, there could be further to run.
The first obstacle to the upside lies around 1.18 – the 50% retracement of the move from 30 July highs to 11 August lows – (see 4-hour chart), which coincides with a cluster of moving averages.
A move above the 61.8 fib may signal that the correction has further to run with the next test coming around 1.19-1.1920 which coincides with the 30 July highs and 38.2 fib – May highs to August lows on daily chart .
A move above here will make things very interesting, with 1.20 falling around the 50 fib and moving average cluster on the daily chart .
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Craig Erlam
Latest posts by Craig Erlam (see all)
- GBP/USD – Dollar slips on dovish Fed - 23 March 2023
- Market Insights Podcast (Episode 448) - 23 March 2023
- A dovish shift from the Fed - 23 March 2023