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U.S. Dollar Index (DX) Futures Technical Analysis – In Position to Challenge Main Bottom at 91.290

James Hyerczyk
·2 min read

The U.S. Dollar hit its lowest level since March 18 late in the session on Wednesday as Treasury yields bounced off their intraday highs, holding just below multi-month levels reached earlier in the month. Reduced demand for the safe-haven currency also weighed on the greenback.

At 20:28 GMT, June U.S. Dollar Index futures are trading 92.645, down 0.200 or -0.22%.

In other news, the U.S. economy grew faster in the early spring and more companies sought to hire new workers, a Federal Reserve survey showed, but inflation also picked up and companies faced an array of shortages that are hindering production.

Daily June U.S. Dollar Index
Daily June U.S. Dollar Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on March 31.

The main trend will change to down on a move through the nearest swing bottom at 91.290.

The minor trend is also down. This confirms the shift in momentum. A new minor top was formed at 92.365. A trade through this level will change the minor trend to up.

The short-term range is 89.655 to 93.470. Its retracement zone at 91.555 to 91.100 is the primary downside target. Inside this zone is the main bottom at 91.290, making it a valid target.

The main range 94.590 to 89.155. Its retracement zone at 91.870 to 92.510 is potential resistance. It is also controlling the near-term direction of the index.

Daily Swing Chart Technical Forecast

The direction of the June U.S. Dollar Index early Thursday is likely to be determined by trader reaction to 91.555.

Bullish Scenario

A sustained move over 91.555 will indicate the presence of buyers. The first upside target is 91.870. Taking out this level could trigger an acceleration into 92.365.

Bearish Scenario

A sustained move under 91.555 will signal the presence of sellers. This could trigger a break into the main bottom at 91.290, followed by the short-term Fibonacci level at 91.100. This is a potential trigger point for an acceleration to the downside with 90.620 the first target.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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