The USD Index held on to marginal gains on the day, after the Consumer confidence index in the US showed a vast improvement in April.
According to data released by the US Conference Board, the Consumer Confidence Index rose from 109.0 to 121.7 in April. This reading blew out the market expectation of a rise to 113.1, and reflects the upbeat nature of the average US consumer following a series of measures to get the US economy back on track.
Additional information from the report indicates that the Present Situation Index and Consumer Expectations Index both edged higher, while the expectations of the 1-year Consumer Inflation Rate remained static at 6.7%.
However, the USD index found itself struggling to hold on to gains made on the day, as the US Dollar continues to remain on weak footing ahead of Wednesday’s FOMC meeting.
The active daily candle has formed a doji which at the moment, has not broken above the 90.965 resistance. This indicates that there is indecision at this resistance. Buying pressure remains weak, and could force a selloff at this point. This would bring 90.503 into focus, with 90.228 and 90.00 (24 February low) serving as additional downside targets.
On the other hand, bulls need to break above 90.965 to allow the USD index a chance to attain 91.261. Here, the channel’s lower border forms a strong barrier to bullish continuation. 91.50 is the price target that benefits from a bullish break above 91.261, with the potential for an advance towards 92.009.
