US Dollar Index (DX) Futures Technical Analysis – 89.16 to 88.85 Important to Support Base Structure

The U.S. Dollar finished higher last week but essentially remains rangebound as investors await the Fed’s interest rate decision, monetary policy statement and economic projections, due to be released on March 21.

Last week, June U.S. Dollar Index futures settled at 89.797, up 0.157 or +0.18%.

Weekly Technical Analysis

The main trend is down according to the weekly swing chart.

The minor trend is also down. A trade through 90.490 will change the minor trend to up. A move through 88.915 will signal a resumption of the downtrend.

The short-term range is 87.830 to 90.490. Its retracement zone at 89.160 to 88.845 is the primary downside target. This zone has provided support the last three weeks.

The intermediate range is 93.480 to 87.830. Its retracement zone is 90.655 to 91.32.

The main range is 94.42 to 87.83. Its retracement zone is 91.12 to 91.90.

Combining the two retracement zones makes 91.125 to 91.32 the primary upside target. Since the trend is down, sellers are likely to come in on a test of this area.

Weekly Technical Forecast

Based on Friday’s close at 89.797, the direction of the index this week is likely to be determined by trader reaction to the downtrending Gann angle at 89.98.

A sustained move under 89.98 will signal the presence of sellers. Crossing to the weak side of the downtrending Gann angle at 89.67 will signal that the selling is getting stronger. This could drive the index into the short-term 50% level at 89.16 and the short-term uptrending Gann angle at 89.08.

The next target under 89.08 is the short-term Fibonacci level at 88.85. This is also the trigger point for an acceleration into the next uptrending Gann angle at 88.46. A move through this angle targets 88.14. This is the last potential support angle before the 87.83 main bottom.

A sustained move over 89.98 will indicate the presence of buyers. This is the trigger point for an acceleration to the upside. The weekly chart indicates there is room to rally to 90.49 then 90.66.