U.S. Dollar Index (DX) Futures Technical Analysis – 91.870 – 92.510 Zone Controlling Near-Term Direction

The U.S. Dollar is edging higher against a basket of currencies early Monday, but remains slightly above a 2-1/2-week low reached last week. The index is being boosted by firming Treasury yields and a weaker British Pound that sank toward a two-month low.

The greenback is coming off its poorest weekly performance of the year as Treasury yields took a breather after scaling multi-month peaks at the end of March, powered by bets that an accelerating U.S. recovery from the pandemic will lift inflation faster than Federal Reserve policymakers anticipate.

At 08:19 GMT, June U.S. Dollar Index futures are trading 92.300, up 0.140 or +0.15%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of a closing price reversal top on March 31.

The main trend will change to down on a move through 91.290. A trade through 93.470 will negate the closing price reversal top and signal a resumption of the uptrend.

The minor trend is also down. This confirms the shift in momentum. A trade through 93.130 will change the minor trend to up. A move through 92.01 will indicate the selling pressure is getting stronger.

The main range is 94.587 to 89.155. The index is currently trading inside its retracement zone at 91.870 to 92.510. This zone is controlling the near-term direction of the index.

The minor range is 93.470 to 92.010. Its 50% level is a potential upside target and resistance.

The short-term range is 89.655 to 93.470. Its retracement zone at 91.555 to 91.100 is the primary downside target area.

Daily Swing Chart Technical Forecast

The direction of the June U.S. Dollar Index on Monday is likely to be determined by trader reaction to 92.510.

Bearish Scenario

A sustained move under 92.510 will indicate the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into 92.010, followed by 91.870.

If 91.870 fails then look for the selling to possibly extend into 91.555, followed by a main bottom at 91.290 and 91.100.

Bullish Scenario

A sustained move over 92.510 will signal the presence of buyers. This could trigger a quick move into 92.740. This is a potential trigger point for an acceleration into the minor top at 93.130.