Technical outlook:
The US dollar index dropped back to the 104.00 mark intraday during the Asian session on Friday. The index had rallied through the 104.30 mark on Thursday before finding resistance again. Prices are seen to be trading just below 104.00 at this point in writing and are expected to break lower towards the 99.00 mark in the near term.
The US dollar index is carving a potential expanded flat corrective wave after printing the 104.88 highs. The structure is expected to terminate close to 99.00, which is also the Fibonacci 0.382 retracement of the earlier upswing between 89.50 and 104.88. Bears will be poised to hold prices below the 105.52 mark to keep the near-term structure intact.
The US dollar index has carved a lower-degree downswing between 105.52 and 103.15 over the past week. Furthermore, prices have pulled back through the 104.85 mark carving a lower high, before reversing lower again. If the above structure holds well, bears will be back in control dragging prices lower through the 99.00 mark.
Trading plan:
Potential drop through 99.00 levels against 106.50
Good luck!
