Dollar rises to new multi-month high as hawkish Fed diverges from its major peers
US DOLLAR INDEX
The dollar index regained traction after brief pullback was strongly rejected at 100 zone and hit new 25-month high on Friday.
The greenback was lifted by a hawkish message from Fed Chair Powell about possible 50 basis points hike in the next policy meeting, which contrasted repeatedly dovish tones from the ECB’s President Lagarde, who hinted that the central bank might need to cut its growth outlook and sidelined some positive signals, sent by ECB policymakers previous day.
Daily chart points to bullish continuation as shallow pullback ended in hammer candle on Thursday and Friday’s fresh bullish acceleration added to positive signals.
Rising bullish momentum and diverging ascending daily Tenkan-sen and Kijun-sen in positive setup, support the action, which is expected to maintain bullish bias above 100 level.
Fresh bulls look for close above previous high at 101.03 to open way towards immediate targets, Fibo projections at 101.50 and 101.79, but could extend above 102 mark on stronger acceleration, as the greenback remains supported by safe-haven buying.
Res: 101.32; 101.50; 101.79; 102.00
Sup: 100.73; 100.33; 100.54; 100.00