US Dollar Index Price Analysis: Attempts to retrace its recent losses, trades near 102.20

US Dollar Index struggles to halt losses amid dovish Fed’s outlook.
Technical indicators suggest that DXY could test the support region around the weekly low at 102.06.
The major level at 102.50 could act as a key barrier followed by the seven-day EMA at 102.58.

Akhtar Faruqui FXStreet

The US Dollar Index (DXY) rebounds after two days of losses, trading around 102.20 during the Asian session on Wednesday. However, the DXY faces challenges due to the Federal Reserve’s (Fed) dovish outlook on the interest rates trajectory. Investors expect the Fed to implement rate cuts in early 2024.

However, during a Wednesday interview on Fox TV, Chicago Fed President Austan Goolsbee commented that the "market has gotten ahead of themselves on euphoria" regarding potential interest rate cuts.

The 14-day Relative Strength Index (RSI) is below the 50 level, signaling a bearish sentiment. Additionally, the negative positioning of the Moving Average Convergence Divergence (MACD) line below the centerline, and showing the divergence below the signal line could serve as confirmation of the bearish momentum for the Dollar Index in the market.

The lagging indicators suggest that the US Dollar Index could test the psychological support region around the weekly low at 102.06 level before the 102.00 level. A firm break below the key support region could put pressure on the DXY to navigate December’s low at 101.77 level followed by the 101.50 major level.

On the upside, The DXY could find the key resistance around the 102.50 major level before the seven-day Exponential Moving Average (EMA) at 102.58 lined up with the weekly high at 102.63 level.

A breakthrough above the resistance area could support the Dollar Index buyers to approach the psychological level at 103.00 near the 23.6% Fibonacci retracement at 103.08 level.

Dollar Index: Daily Chart

Dollar Index Spot: Additional technical levels

Overview
Today last price	102.16
Today Daily Change	0.04
Today Daily Change %	0.04
Today daily open	102.12

Trends
Daily SMA20	103.3
Daily SMA50	104.72
Daily SMA100	104.61
Daily SMA200	103.5

Levels
Previous Daily High	102.63
Previous Daily Low	102.06
Previous Weekly High	104.27
Previous Weekly Low	101.77
Previous Monthly High	107.11
Previous Monthly Low	102.47
Daily Fibonacci 38.2%	102.28
Daily Fibonacci 61.8%	102.41
Daily Pivot Point S1	101.91
Daily Pivot Point S2	101.71
Daily Pivot Point S3	101.35
Daily Pivot Point R1	102.48
Daily Pivot Point R2	102.83
Daily Pivot Point R3	103.04

Author

Akhtar Faruqui

FXStreet

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

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