After an initial drop due to low than expected retail sales in March of 2023, the USD index $DYX recovers from a One-Year Low of 100.78, now at 101.552. With Bollinger Bands 24.82% narrower than normal the Dollar index is less volatile than usual. However the possibility of a sharper move in the near term has increased. KXCOs forecast of the $DYX is short term buy, long term sell.
Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
“Personal consumption flattened out in February and March, but this followed a huge jump in spending momentum in January,” Jefferies money market economist Thomas Simons said in a note. “The bottom line is that the weakness in February and March looks distressing in isolation, but the quarterly averages are much stronger due to the spending spree in January.”
“It was generally on the weak side with the exception of the retail sales control group, which is super core retail sales, it was just a little less negative than expected and makes you think that maybe the market was looking for something much weaker,” said Mazen Issa, senior foreign exchange strategist at TD Securities in New York.
“The overarching theme is you’re getting a slowdown,” said Issa. “I think what gets overlooked is it may take longer for things to unfold, maybe a grind, and the U.S. economy is more resilient than people have given it credit for.”
US DOLLAR INDEX(Trade Price) is currently 4.6% below its 200-period moving average and is in an downward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume into .DXY (bullish). Our trend forecasting oscillators are currently bearish on .DXY and have had this outlook for the last 19 days.
The Stochastic Oscillator is 18.3590. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20. The last signal was a buy 5 days ago.
The current value of the RSI is 40.87. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 140 days ago.
The current value of the CCI is -121.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 5 days ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 24 days ago.
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