The dollar index is strong at the opening of this year
- The dollar index started this year successfully.
Dollar index chart analysis
The dollar index started this year successfully. We are in a bullish consolidation until the market opens on January 2nd. This week, we started at 101.38 and are now at 102.44. The dollar easily crossed the EMA50 moving average and continued on the bullish side. During the Asian trading session, the index was maintained above 102.00, leading to further recovery. Potential higher targets are 102.60 and 102.80 levels.
We need a negative consolidation and a new test of the 102.00 level for a bearish option. A break below would mean that we don’t have the strength to recover, and we’re going into retreat. We would again have the opportunity to test the EMA50 moving average, and the potential lower targets are the 101.80 and 101.60 levels.
The first week after the new year brings a lot of news
Yesterday’s US data showed that there was a drop in the US Manufacturing PMI from 49.4 to 47.9 level. Despite the bad result, the dollar continued its recovery without letting this affect it. Tomorrow will be interesting as we have an address from the FOMC members late in the evening. Their meeting could be more interesting for the further movement of the dollar index.
Other news tomorrow is the ISM Manufacturing PMI and JOLTs job openings. On Thursday, at the beginning of the US session, we have news about German inflation, then the ADP NFP report, Initial jobs claims for the previous week and Service PMI. Friday, we start with Eurozone inflation and continue with NFP and the unemployment rate. Definitely, the first week of the new year brings a lot of news that could drastically affect the movement of both the dollar index and other pairs.
