Technical outlook:
The US dollar index rallied through the 104.89 highs during the Asian session on Monday before finding resistance. The index has slipped back since then and is seen to be trading close to 104.40 at this point in writing. The bulls are still looking inclined to hold prices above the 103.70 interim support and to push higher towards 107.00 in the near term.
The US dollar index seems to have either completed its corrective drop from 114.70 highs at 103.70 or is carving a much deeper correction lower. Either way, a corrective rally cannot be ruled out from the current levels with the 103.70 intact. The potential upward target is seen at around 110.50 which is also the past support-turned-resistance zone.
The US dollar index needs to break above the immediate resistance at 107.00 to confirm that the bulls are back in control until at least the 110.50 level. On the flip side, if a meaningful bottom is already in place around 103.70, the bulls will be inclined to push prices to fresh highs above 114.70. Traders are looking higher from here in the medium term.
Trading idea:
Potential bullish turn against 103.00
Good luck!
