Technical outlook:
The US dollar index has been drifting sideways from the 103.78 high that was registered on April 28, 2022. The probability remains for yet another high above 103.78 before finding resistance and giving in to bears. A failure to break below 102.65 will confirm that a meaningful top is in place around 103.65 and that bears are back in control.
The US dollar index remains just shy of a multi-year resistance close to 103.90-104.00 levels as bulls remain inclined to break higher. It should be the final thrust wave above 104.30 before bears resume to drag prices lower. Only a break below the 102.66 interim support will ensure that a meaningful top is already in place.
The US dollar index is well supported around 99.65, followed by 97.60 and 94.60 levels respectively. A break below 99.65 will confirm that the potential trend has reversed and bears would remain in control going forward. Probabilities remain high for a bearish trend reversal going forward as the index trades at multi-year highs against EUR.
Trading plan:
Potential drop to 99.65 and 97.60 against 104.50
Good luck!
