The charts are doing the talking now as we look to the final trading day of the week. The dollar had already come under pressure after the US CPI data on Wednesday and finally got to witness some key technical moves in a couple of dollar pairs yesterday.
All of this is solidifying the case for another downside leg in the dollar. So, let's get straight into the charts for a better look.
Our first stop is EUR/USD as the pair rises to its highest levels in a year, with buyers looking to reinforce a breakout above the 1.1000 level. The figure level had previously helped to stall the advance in February, before the latest run up also saw a couple of key technical resistance levels come into play.
The 100-week moving average (red line) is one, alongside the 50.0 Fib retracement level of the swing lower from January 2021 to September 2022, seen at around 1.0942-48. A firm break above that as well as the 1.1000 mark is really laying out strong grounds for EUR/USD to chase a move towards 1.1200 at least next.
In a somewhat similar style of break, GBP/USD is rising above 1.2500 after having been thwarted on a couple of occasions just below that from the December highs around 1.2443-46 previously. There was an attempt to get above both resistance levels last week but that ultimately fell short before buyers are reinvigorated again this week.
A firm weekly close above 1.2500 will bode well for a further upside push, potentially targeting the 100-week moving average (red line) next - seen at 1.2773 currently.
The dollar's woes against European currencies are not just contained to the euro and pound, with the Swiss franc also rising to its highest levels since February 2021 against the greenback.
USD/CHF broke below 0.9000 earlier in the week but is quickly tripping lower with sellers eyeing key support at 0.8800 next. That is a major level to watch as a break below that will pit chartists against the 2015 plunge amid the whole SNB fiasco. In other words, there isn't much technical reference to really guide support levels besides big psychological and figure level points on the chart.
Another interesting pair this week is USD/CAD as it falls below its 200-day moving average (blue line) for the first time since June last year. The pair had been under some pressure in the past week or so as oil prices jump higher, following the surprise OPEC+ decision to cut production. In turn, that provided a bit of a tailwind for the loonie.
With the break back below 1.3400 and the key support level mentioned above, sellers are now in control and keeping a more bearish momentum. That might allow for a stronger opportunity to break support from the February lows around 1.3262-67 before taking a look at the November lows around 1.3225-35 next.
And with markets slowly firming up the narrative that the Fed will join the BOC to the sidelines by June, the policy convergence view is something that is also working against the dollar at the moment.