Technical Update - Dollar Index: 2022 has been the year of the Dollar. Will it continue?
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
There is no divergence on RSI indication the Dollar Index could move higher in coming months. A move to the 1.618 projection at 113.10 is in the cards but the uptrend could extend to 115-120.
However, on the short- to medium term the Dollar Index is showing RSI divergence which indicates a correction is in the cards, but if RSI breaks above its upper falling trend line on the weekly chart the uptrend could extend further as describe above.
A correction is likely to be minor and if the Dollar Index doesn’t close below support at around 104.52 the uptrend is intact.
Also, on the daily chart there is RSI divergence indicating a looming correction possibly down to t4est the lower rising trendline.
However, if RSI breaks above its rising trendline the divergence can be cancelled and the uptrend will continue. A break below 107.65 could be the tricker for a correction.
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