The US Dollar Index (DXY) ended a 3-day skid by rebounding off the 20-day moving average. The 38.2% retracement provided support, allowing the greenback to maintain its near-term bullish structure. However, the ensuing rally rejected near the key 80 threshold to potentially shift the focus back towards the 20-day moving average and key 38.2% retracement. Reclaiming 80 would reinforce the original outlook for a move towards the 200-day moving average.
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The EUR/USD rejected at the 20-day moving average, failing to test the 38.2% retracement at 1.3460. Failing to reclaim the November 16th swing low has maintained the bearish structure. Fortunately for euro bulls the subsequent relapse was contained by a key Fibonacci retracement at 1.3260. While this pivot remains supportive, a retest of the 20-day moving average is favored. Losing 1.3260, however, will expose the 1.3150/1.3210 region.
