FxWirePro: DXY hammer to extend upswing upto 21-DMAs, gravestones and shooting stars in major trend to counter, leading and lagging indicators in bears’ favor

The US dollar index forms hammer pattern candlestick at 99.84 levels, historically, the bulls test the support at the same levels and the same bullish pattern has occurred to the evidence the upswings upto the peaks of 102.26 levels (refer daily charts).

For today, the rallies are extended today as well upto 99.99 levels but these bullish sentiments are not substantiated by both momentum and trend indicators on this timeframe.

On medium term perspective, Gravestone doji & shooting stars evidence more slumps upto next strong support at 98.91, leading & lagging indicators signal momentum & downtrend continuation (refer weekly chart).

Both RSI and stochastic curves evidence downward convergence with the prevailing slumps.

MACD on both timeframes signals bearish trend to prolong further.

Fundamentally, the US administration, on the other hand, has returned to its tax plans. Treasury Secretary Mnuchin promised last night that there will be far-reaching reforms before the end of the year. The FX market no longer pays much attention to these promises.

Neither had the government so far convinced in other key areas nor do we have sufficient knowledge as to which way the tax reform would go.

The times immediately after the election when anything Trump or his supporters said was capable of moving the markets are long since over. The process happened surreptitiously - but that is what happens once the FX market starts to make up its mind

While the FxWirePro currency strength index for the dollar was little changed, despite relinquishing its gain for the second day for the week after gaining traction found in bullish pattern as stated above but the overall dollar basket is still weaker.

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