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Dollar Technicals: 11/26

by on November 27, 2013 3:48 am GMT
 

The dollar index had a rough day as consumer confidence hit a low point and missed expectations. The consumer confidence missed for the second month in a row and the biggest miss in eight months. The print for November was 70.4, down from last month’s upward revision of 72.4.

The intraday chart is showing a descending channel with  price action breaking to the downside, subsequently the 200 EMA as well. Trend strength is weak, but the dollar can move given the right catalyst. There is price action support just under 80.50, but the descending support trend line is located at 80.40. The 20/50 bearish crossover is not helping dollar bulls in the least. It is quite possible the dollar will continue to float downward until December’s FOMC minutes meeting. Intraday upside to the 20 EMA, 80.85, is a likely pullback scenario.

4H Chart of DX

4H Chart of DX

The daily chart showed rejection of the 200 EMA and 61.8 percent Fibonacci multiple times prior to the dollar’s downside. Price action is breaking through the 50 and 20 EMA, while pulling the 50 EMA underneath the 20 EMA. The daily support is slightly lower at 80.21.

1D Chart of DX

1D Chart of DX

Look for continued weakness throughout the week in the dollar index. The US reports core durable goods and unemployment claims 8:30AM, pre-New York open.

Less than favorable results will pull the dollar down as it signals continued Fed stimulus. However, employment data usually shows seasonality with an influx of part-time seasonal jobs for the holiday season.