The question in the title of the last Morning Call must be answered with "no" at the current level of the dollar. Yesterday there was a deep red daily candle. The dollar index (DXY) has thus rejected resistance at 104.70 for the time being. In the end, the reason was weak consumer confidence data, which the market interpreted dovishly. Accordingly, US bonds were bought and the dollar sold with falling yields. But I had also written that the 104.70 mark would be difficult to overcome: “However, the next resistance is already at the 104.70 level. A breakout above this mark could be difficult for the time being but should of course be respected.” (MC #159)
EURUSD -- 1.0888
The currency pair’s break below the 200 dma (1.0813) was short-lived. However, the first test of this important resistance line is rarely successful. In this respect, I would not overestimate the current rally. For me, the 50 ema (1.0929) remains the short term resistance level. Above this moving average, the 1.1000 level is probably quickly reached again.
USDCHF -- 0.8796
The Dollar is not making progress against the Swiss franc this year. After the breakout attempts above the 50 ema in March and in May/June were sold, the same scenario is currently looming. Ultimately, the Swiss franc remains the safest haven. And it doesn't help the dollar to have the interest rate differential on its side. As an exception, I am posting a weekly chart today that shows the 2023 price trend in a more interesting way. Obviously, the mid-Bollinger band is a big hurdle for the dollar. Dollar longs need patience in any case.
(daily)
(weekly)
AUDUSD -- 0.6469
The Aussie made it above the 0.6458 resistance yesterday and is now trying to leave the mid Bollinger band (0.6473) behind. The price trend in August also points to a bottoming out. Ideally, a clear daily close above the 0.6484/88 resistance zone would now follow. Above this, one should get rid of shorts at the latest.
Good luck,
Sebbo