Dollar’s Decline Slows Down; What Lies Ahead?

The decline of the dollar has stretched into a fourth consecutive day, briefly pushing the US dollar index below 104. However, it displayed the smallest daily range among these four days. In a surprising late-day recovery, the dollar managed to close above the monthly S2 pivot point, forming a small bullish hammer that raises questions about its future trend.

This mixed performance suggests a tug of war between bullish and bearish sentiments in the forex market. Traders are keen to see if this recovery could lead to a more sustained reversal or if the dollar will continue on its path downward. The next few sessions are critical for gauging the dollar’s direction going forward.