The greenback began the week on a negative note, falling to a nearly two-month low of 90.80 after recording its third consecutive week of declines last week.
The other constraining factor for the dollar is renewed optimism about Europe. After several months of prolonged health restrictions, optimism is returning thanks to better-than-expected economic statistics, but also the clear acceleration of the vaccination campaign and announcements by officials indicating that herd immunity could be achieved as early as July, whereas the current pace is more likely to be next winter.
In the nearer term, investors will learn about the Fed's monetary policy decision on Wednesday. No policy changes are expected, but Jerome Powell's words will be scrutinized as usual as investors look for clues as to when monetary policy will be normalized.
A pullback below this oblique would be a signal of fragility on the part of buyers. A further decline below the symbolic 90-point level would be an additional signal that the downtrend is continuing.
(Chart Source: Tradingview 26.04.2021)
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