US Dollar Index (DX) Futures Technical Analysis – Counter-Trend Buyers May Come in at 88.835

March U.S. Dollar Index futures posted a volatile two-sided trade on Thursday before closing higher. The index was driven lower early in the session by negative comments from Treasury Secretary Steven Mnuchin and driven higher after President Trump made supportive comments for the dollar.

Daily Swing Chart Analysis

The main trend is down according to the daily swing chart. However, yesterday’s closing price reversal bottom suggests that momentum may be getting ready to shift to the upside.

A trade through 88.255 will negate the closing price reversal bottom and signal a resumption of the downtrend. A move through 89.415 will confirm the closing price reversal bottom.

The short-term range is 88.255 to 89.415. Its 50% level or pivot is 88.835. This pivot could become support.

The main range is 90.765 to 88.255. Its retracement zone at 89.416 to 89.734 is the primary upside target.

Daily Swing Chart Forecast

Based on the early price action, trader reaction to 89.416 will determine the direction of the index today. It also forms a resistance cluster with yesterday’s high at 89.415.

A sustained move under 89.416 will signal the presence of sellers. This could drive the index into the pivot at 88.835. If this market is going to move higher then aggressive counter-trend buyers will come in on a test of this level. They are going to try to form a secondary higher bottom.

If 88.835 fails as support then look for the selling to extend into 88.255. This is followed by the December 16, 2014 main bottom at 88.067.

A sustained move over 89.416 will indicate the presence of buyers. This could trigger a fast move into the Fibonacci level at 89.734. This price is a potential trigger point for an acceleration to the upside with potential targets at 90.68, 90.765 and 91.00.