The US Dollar Index (DXY) is not done just yet as the index has hopes of going higher. As a result, many of the major currency pairs are projecting potential short-term shorts.
After revisiting 90.50 yesterday, the DXY has found itself on a path back to 91.00. The index is up 0.68% for the day without a cause or a reason. This sort of unexpectedness is to be expected moments away from the Holidays. Currently, price is trading near 90.65, but analysis suggests that 91.00 is the most likely destination to be met in the next few days.
Not surprisingly, EURUSD is down 0.64% for the day and has found itself below the key level of 1.21700. A breach of this level was initially used by traders to go long. Now that price is back below this area, price action could pay a visit to the bottom of the range at 1.21200. Both price action and smart money traders are watching to see if price can close below the previous swing low in order to confirm a bearish bias.
With Thursday being Christmas Eve and many brokers having reduced or closed trading hours, tomorrow appears to be the last day of trading for the year. At this point, traders should not be seeking any trades and should ultimately be out of the markets as participants. Those that are eager to trade could always backtest and study past price action.
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- Read yesterday’s breakdown: DXY Gap and Holiday Trading Conditions
