U.S. Dollar Index (DX) Futures Technical Analysis – Ready to Challenge Wall of Resistance at 96.025 – 96.315

The U.S. Dollar is edging higher against a basket of currencies on Monday as traders reassess last week’s mixed U.S. Non-Farm payrolls report and its potential impact on the Federal Reserve’s timetable for its first and subsequent interest rate hikes.

Additionally, traders are positioning themselves ahead of comments from several Federal Reserve policymakers throughout the week and Wednesday’s U.S. consumer inflation report.

At 10:05 GMT, March U.S. Dollar Index futures are trading 95.895, up 0.173 or +0.18%. On Friday, the Invesco DB U.S. Dollar Index Bullish Fund ETF (UUP) settled at $25.66, down $0.14 or -0.56%.

Early this week, Fed Chair Powell and governor Lael Brainard will testify before Senate committees about their nominations as chair and deputy chair at the central bank. On Wednesday, the Commodity Price Index (CPI) is expected to come in at 7% year-on-year.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, momentum is trending lower. A trade through 96.475 will signal a resumption of the uptrend. The main trend will change to down on a move through 95.575.

On the upside, the index faces a wall of resistance at 96.025, 96.200 and 96.315.

On the downside, the nearest support is 95.360, followed by a support zone at 95.050 to 94.610.

Daily Swing Chart Technical Forecast

The direction of the March U.S. Dollar Index on Monday is likely to be determined by trader reaction to 96.025.

Bearish Scenario

A sustained move under 96.025 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into 95.575, followed by a main bottom at 95.500 and a 50% level at 95.360.

Bullish Scenario

Overtaking 96.025 will signal the presence of buyers. If the buying is strong enough then look for the rally to possibly extend into 96.200 and 96.315.

Overcoming 96.315 will indicate the buying is getting stronger, while taking out the minor top at 96.475 could trigger an acceleration to the upside with potential targets coming in at 96.670 and 96.895.