Technical outlook:
The US dollar index rose above the 104.20-30 zone during the New York session on Tuesday, falling in line with the projections. Please note that the index could still rally towards 104.60 before finding resistance and turning lower again. Bears will remain poised to hold prices below the 105.52 interim resistance to keep the momentum intact.
The US dollar index has carved a larger degree upswing between 89.50 and 105.52 from January 2021 until recently. The index is producing a similar-degree corrective drop towards 99.00. Also, note that 99.00 is close to the Fibonacci 0.382 retracement of the above rally and hence potential for a bullish bounce is higher.
The US dollar index has further carved a lower degree downswing between 105.52 and 103.15 recently. Prices drifted sideways for a while and are retracing the above downswing as potential remains towards 104.60. Please note that the Fibonacci 0.618 retracement of the above downswing is also passing through 104.60, hence there is a high probability for a turn lower.
Trading plan:
Potential drop through 99.00 against 106.00
Good luck!
