Technical outlook:
The US dollar index has dropped through 100.50 lows during the Asia Session on Wednesday, after reversing from 100.91 fresh swing highs earlier. The index might have carved a potential top just below 101.00 mark and is now looking to print lower lows and lower highs going forward. Bears will remain poised to hold prices below 100.91 mark to keep the immediate structure intact.
The US dollar index is producing an Engulfing Bearish candlestick pattern on the daily chart since 100.91 mark. If the above completes successfully, it would indicate a potential trend reversal ahead and drag prices through 97.60 initial support. A break there will certainly confirm that trend has reversed and bears are back in control.
The US dollar index had earlier dropped from 104.00 highs through 89.20 lows carving a meaningful larger degree downswing. It has been retraced to fibonacci 0.786 level seen close to 101.00 on the daily chart here. High probability remains for a bearish turn from here and break below 97.60 mark will be the first step confirmation.
Trading plan:
Potential drop to 97.60 near term, against 101.50
Good luck!
