Dollar edges higher as traders look to charts for guidance

Athens - The Bloomberg Dollar Spot Index held its ground on Monday with many investors turning to technical charts to assess their next steps.

Flows were thin with interest by real money and macro names subdued and fast-money accounts dominating price action alongside some corporate demand, traders across Europe said. With short-term drivers limited, investors turned to technical analysis signals such as moving averages to determine potential entry and exit position levels.

The dollar’s technical outlook provided conflicting signals as price action suggested bears were still in control, albeit to a lower degree. Momentum studies, including slow stochastics and moving average convergence divergence or MACD, have turned bullish and pointed to a potential break of trendline resistance.

Dollar bulls are looking to add on a downside break of $1.1100 in the euro and $1.2630 versus the pound, said the traders, who asked not to be identified as they weren’t authorised to speak publicly.

Sterling was higher as early London demand for cable prompted stops in the euro-pound cross to be triggered. Almost a year after the Brexit referendum took place, negotiations between UK Brexit Secretary David Davis and EU chief negotiator Michel Barnier are set to kick-off in Brussels.

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