US Dollar Index (DX) Futures Technical Analysis – Trend Changes to Up on Trade Through 89.48

March U.S. Dollar Index futures posted a two-sided trade on Thursday before closing lower for the session. Despite rising U.S. Treasury yields and a hawkish Fed monetary policy statement earlier in the week, the dollar appears to be in the strong hands of short-sellers.

Daily Swing Chart Analysis

The main trend is down according to the daily swing chart. A trade through 89.48 will change the main trend to up. A move through 88.255 will signal a resumption of the downtrend. This could trigger a further break into the December 16, 2014 main bottom at 88.067.

The short-term range is 88.255 to 89.48. Its 50% level or pivot is at 88.87. This price is controlling the short-term direction of the market.

The intermediate range is 90.765 to 88.255. Its retracement zone at 89.51 to 89.81 is resistance. This zone stopped the rally at 89.48 earlier in the week.

The main range is 92.36 to 88.255. If there is a massive short-covering rally then its retracement zone at 90.31 to 90.79 will become the primary upside target.

Daily Swing Chart Forecast

Based on the early price action, the short-term pivot at 88.87 is likely to determine the direction of the dollar index on Friday.

A sustained move under 88.87 will indicate the presence of sellers. This could trigger a break into 88.255 then 88.067. The latter is the trigger point for an acceleration to the downside.

Overtaking 88.87 and sustaining the rally could drive the index into 89.48. If the trend changes to up then look for a labored rally as the market challenges 89.51 then 89.81. The upside momentum will begin to increase over 89.81 with 90.31 the next 50% target.