Technical outlook:
The US dollar index has print yet another high around 100.89 mark early hours on Tuesday. The index had pulled back thereafter, dropping to 100.60 and is now seen to be trading close to 100.75 level. It is unfolding as a doji candlestick pattern on the daily chart and if confirmed, it could be potential trend reversal ahead.
The US dollar index has consistently rallied through fresh swing highs since printing 99.70 low on March 31, 2022. It should be noted that each high has been accompanied by a bearish divergence on the RSI (not highlighted today). This is an indication of potential bearish resumption and a break below 99.70 initial support will confirm.
The US dollar index had earlier dropped between 104.00 and 89.20 carving a meaningful downswing. The same has been now retraced with prices almost reaching 101.00 mark, which is fibonacci 0.786 level. High probability remains for a turn lower from here as bears prepare to be back in control.
Trading plan:
Preparing for potential drop aginst 101.50
Good luck!
