With the dollar index recovering but facing resistance at higher levels, attention is turning to the direction of the U.S. dollar

With the dollar index recovering but facing resistance at higher levels, attention is turning to the direction of the U.S. dollar

07.12.2023

In the previous day’s U.S. currency trading, while the Dollar Index recovered to 104.1, the U.S. dollar saw mixed results against the yen. USD/JPY remained range-bound between 148.886 and 147.492, with trading centered around the 20-period moving average (MA). During today’s Asian session, downward pressure has prevailed on USD/JPY, causing it to fall to 146.704.On the daily chart, the 75-day moving average is acting as resistance, and with the RSI also trending downward, traders should pay close attention to price movements during U.S. trading hours.

Despite the improvement in the EU’s October retail sales figures released yesterday—which showed a year-on-year decline of 1.2% compared to the previous month’s 2.9% drop—the euro fell against the yen for the ninth consecutive day. From a technical perspective, the EUR/JPY pair has repeatedly broken well below the 75-day moving average, and the daily RSI continues its downward trend after rising above 70. We will be watching closely to see if the euro’s decline continues unabated during European trading hours.

Today, at 3:45 PM, Swiss employment figures; at 4:00 PM, German industrial production and UK Halifax house prices; at 4:45 PM, French trade balance; at 5:00 PM, Czech construction output; at 5:30 PM, Hong Kong foreign exchange reserves; at 7:00 PM, Eurozone Q3 GDP;Mexico’s Consumer Price Index at 9:00 PM, the U.S. Challenger Job Cuts at 9:30 PM, U.S. Initial Jobless Claims and Canadian Housing Starts at 10:30 PM, U.S. Wholesale Inventories at midnight, U.S. Consumer Credit at 5:00 AM, and New Zealand’s Q3 Manufacturing Sales at 6:45 AM the following day.We will carefully assess the direction of the U.S. dollar, as the dollar index has recovered but faces resistance at higher levels.