DXY: Risk of a deeper pullback towards 106.45 – ING

The Dollar Index (DXY) uptrend stalled near 110.15 last month, BBH FX analysts note.

MACD posts negative divergence

“Recent attempt to cross this hurdle has remained futile and the index has retracted towards the upper limit of previous multi-month range at 107. Daily MACD has been posting negative divergence denoting receding upward momentum.”

“Recent price action has evolved in a range defined by limits of 107 and 110.15. In the event that the index breaches 107, there would be risk of a deeper pullback towards 106.45 and perhaps even towards December low of 105.40/105.15.”