Bearish on US dollar: eyes on US debt ceiling - BBH

Analysts at Brown Brothers Harriman explained that the broad technical condition of the dollar changed little in recent days.   

Key Quotes:

"After depreciating on a trend basis for much of the first seven months of the year, the dollar spent August largely consolidating. Although the focus is on monetary policy, we are concerned about the US debt ceiling and spending authorization with the fissures in the majority party that has hardly passed a single bill in the past six months. If these issues can be addressed without much disruption, the dollar may begin recovering, but there is much wood to chop first.  

For the better part of the past two weeks, the Dollar Index has alternated between gaining and declining sessions. The Dollar Index finished last month near 92.85. It is spitting distance from it now. The consolidation has largely corrected the oversold technical condition. The Slow Stochastics have turned lower, while the MACDs may be a few sessions away from crossing down. A shelf has been carved around 93.00. The low for the year was set earlier this month near 92.55. The low from May 2016 was a little below 92.00, and the 91.20 area corresponds with a 50% retracement of the rally since mid-2014. The 61.8% retracement is closer to 88.25."