U.S. Dollar Index (DX) Futures Technical Analysis – Sitting Inside Main Retracement Zone at 91.870 to 92.510

The U.S. Dollar is trading steady-to-higher against a basket of major currencies ahead of the U.S. Forex opening on Friday. The dollar is recovering from several days of losses as U.S. Treasury yields rebound from earlier lows.

The greenback fell to its lowest level since March 23 on Thursday as unexpectedly strong economic data in Europe, downbeat U.S. weekly initial unemployment claims and a determinedly accommodative Federal Reserve have prompted investors to unwind some bets on the greenback.

At 10:00 GMT, June U.S. Dollar Index futures are trading 92.275, up 0.206 or +0.22%.

Some traders are saying that robust producer prices from China boosted hopes of a swift recovery, driving up U.S. Treasury yields overnight. China’s March factory gate prices rose at their fastest annual pace since July 2018 beating estimates. Others are saying we’re looking at profit-taking ahead of the weekend.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. The main trend will change to down on a trade through 91.290. A move through 93.470 will signal a resumption of the uptrend.

The minor trend is also down. A trade through 93.130 will change the minor trend to up. This will shift momentum to the upside.

The index is also down seven sessions from its most recent top. This puts it inside the window of time for a potentially bullish closing price reversal bottom.

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 short-term range is 89.655 to 93.470. Its retracement zone at 91.554 to 91.100 is potential support.

The minor range is 93.470 to 92.010. Its 50% level at 92.740 is a potential resistance level.

Daily Swing Chart Technical Forecast

The index has formed an inside move early in the session. It’s also trading on the strong side of a 50% level at 91.870 and the weak side of a 61.8% level at 92.510.

Bullish Scenario

Holding above yesterday’s low at 92.010 will indicate the presence of buyers. Taking out 92.510 will indicate the buying is getting stronger. This could trigger a rally into the pivot at 92.740.

Bearish Scenario

Holding below 92.510 will signal the presence of sellers. Taking out yesterday’s low at 92.010 will indicate the selling is getting stronger. A move through 91.870 could trigger an acceleration to the downside with 91.555 the next likely target.