Dollar index under pressure ahead of Thursday’s US GDP news

• At the start of this morning’s session, we saw a slight bearish gap in the dollar index. 

Dollar index chart analysis

At the start of this morning’s session, we saw a slight bearish gap in the dollar index. The movement has continued in the 104.20-104.35 range. On the downside, the EMA 50 moving average supports us, but bearish momentum is current and could break below to a new daily low. On the upside, in the weekly open price zone, additional resistance is in the EMA 200 moving average.

An impulse below 104.10 would confirm bearish pressure on the dollar index and force it to continue its retreat. Potential lower targets are 104.00 and 103.90 levels. Last week’s index low was formed at the 103.65 level.

On Monday, the dollar was under pressure at the 104.20 level and could continue to be even lower.

For a bullish option, we need a positive consolidation up to the 104.35 level. We find it at the weekly open price and the EMA 200 moving average. This time, we could get stronger bullish momentum, with which we would jump over this resistance zone. This would push the index to a new high and thereby increase the optimism that the dollar has the strength to start growing on the bullish side. Potential higher targets are the 104.40 and 104.50 levels.

This week, economic news from the US market is in focus. Data on Existing Home Sales will be released on Tuesday. For Wednesday, we highlight US Manufacturing PMI, S&P Global Services PMI, New Home Sales, and Crude Oil Inventories. The Bank of Canada will announce the future interest rate. Economists expect the bank to lower the interest rate from 4.75% to 4.50%. On Thursday, we have US GDP and Initial Jobs Claims. All this news could have a good impact on the dollar index.