Monday's rally of USD index caused the bulls to catch up around six-week highs of 93.7, the highest level since late August. US dollar index (DXY) is consolidating the previous day's gains which is a key resistance level to have an eye on.
If indeed the bulls manage to breach the resistance zone at 93.70s , the confirmation of an inverted head and shoulders pattern may also signal a trend reversal and may be more significant because such a move would confirm a new higher high. Besides, acting as the filter early indication of the greenback reversal was seen by the formation of a bullish divergence from the Awesome Oscillators.
As a result, buyers are eyeing towards 96.00 (June 2020 swing low) confluence with 161.8% Fibonacci Extension of the September bullish move. Hence, a bullish turn could be expected if prices push above 93.70s and a potential upside targets remain towards the 96.00 round-figure mark.
