The Dollar bulls found support at the 200-day moving average and bounced following renewed hopes of a trade deal from Kudlow’s remarks yesterday. However, the bounce was relatively limited compare to the US Equities, which was fueled to break to new all-time highs after the recent trade deal remarks. As a result, the Dollar bulls will likely follow the equities in today’s session, pushing the pair higher. Nevertheless, if the buyers will not be able to take advantage of this bullish momentum, then a drop to the recent lows and possibly further will be likely scenario.
The bears were able to retest the 200-day moving average as expected, however the battle to break below that key level won’t be as easy. The bulls came in and boosted the pair higher towards the 108.65 resistance level. The buyers need to break above that level to shift the near-term sentiment in their favor. However, if the bulls lose momentum and the bears break below the 200-day moving average, then further drop towards 107.90 will be a likely scenario.
Support: 108.35 / 107.90
Resistance: 108.65 / 108.90