U.S dollar index long-term technical analysis
The index manages to pull-off from sell-off in November and settle the month with a small gain. Although the situation stays positive for the bull, there is growing bearish sentiment in the index. For the start, The Fed looks dovish after Jerome Powell speech. Moreover, The release of The Fed meeting minutes also confirmed the dovish sentiment.
December might become the proxy for The Fed next move. Reiteration in the rate-hike plan will deter the index movement and could start a new bearish trend. On another hand, trade talks between President Trump and China Xi Jinping are under progress behind the G-20 meeting. A deal means the global market situation will calm down and lead U.S dollar index down. No deal means the index ready to shot to the upside.
New Month
Monthly chart
The index suffered sell-off at the beginning of November but recovered from its losses and later swing up and down to close the month flat. Overall direction is pointed to the upside and currently the index testing resistance to 97.50. If there is close above 97.50 at the end of December then we think the path toward 99.40 – 100.00 is open next year.
Weekly chart
The trend on U.S dollar index weekly chart continue bullish and playing near the weekly SMA 200. It moved above the averages recently and maintained the level above it. If the bull could break 97.50 resistance then we could see U.S dollar index on the path higher.
Daily chart
Another bounce happens in the U.S dollar index and confirmed the continuation of the triangle pattern. There is no change in the direction of the index which is upward. It is better to continue holding a long position as we have an ascending triangle pattern with the top at 97.50 now.
Trade plan (For U.S dollar pair)
A long position still favored but there is a shift in sentiment from the Fed. Currently, The Fed looks a little bit dovish and might reiterate their rate-hike plan for next year. If trade deal between U.S-China reached this month then U.S dollar index might start tumbling.