Dollar Index Surges on Strong US Data

The dollar index climbed to a three-week high on Tuesday, boosted by stronger-than-expected US JOLTS data and consumer confidence figures.

These solid numbers reinforce the view that the US economy remains resilient, providing fresh support for the dollar.

Bulls breached the barrier at 104.55 (50% retracement of 105.78/103.31 / daily Kijun-sen). A break here would expose the base of the thinning daily cloud (104.73), which also acts as a magnetic level.

The near-term action remains biased higher following Monday’s close above the 200DMA (104.11). However, caution is still needed as moving averages are in a mixed setup, and the north-heading 14-day momentum is still in negative territory.

A sustained break of the 104.55 pivot would improve the near-term structure for an attack on the daily cloud (spanning between 104.73 and 104.89).

Only a return and close below the 200DMA would sideline the bulls.

Markets are looking for fresh signals from key economic releases for the dollar this week, including the FOMC rate decision and US labor data.

Res: 104.55; 104.73; 104.89; 105.20
Sup: 104.26; 104.11; 103.80; 103.67