US Dollar Talking Points:
- The US Dollar[1] is bouncing to start June trade, coming on the heels of a two-week pullback at the end of May.
- May price action produced the first bearish monthly bar of 2022 trade. But, support has already showed up at a key spot, with an assist from a Fibonacci retracement at 101.80. Are USD[2] bulls knocking on the door with NFP[3] on Friday and the FOMC[4] in 2 weeks?
- The analysis contained in article relies on price action[5] and chart formations[6]. To learn more about price action or chart patterns, check out our DailyFX Education[7] section.
The US Dollar just completed its first bearish monthly bar of 2022 trade. The early-portion of the month saw bulls drive up to another fresh high, this time setting a fresh 19-year-high in the currency. But that strength dissipated in the second-half of the month as stocks started to show signs of pulling back.
The second-half of May saw the entirety of those early-month gains erased, with prices returning back to a key zone on the chart, plotted around some prior resistance that’s around the 61.8% Fibonacci retracement[8] of the 2001-2008 major move.
US Dollar Monthly Price Chart
Chart prepared by James Stanley[9]; USD, DXY on Tradingview[10]
US Dollar Shorter-Term
On a shorter-term basis, support is playing-in from a prior spot of resistance. This plots around a trendline[11] projection from a bullish channel that guided the currency for the better part of a year until the mid-April breakout. This support came into play on Monday and that led to a bounce yesterday
