- DXY keeps Monday’s bearish mood despite recent bounce off intraday low.
- Bearish MACD, sustained break of the monthly support line favor bears.
- 61.8% Fibonacci retracement lures the sellers, confluence of immediate resistance line and 50-day SMA restrict bull’s entry.
US dollar index (DXY) consolidates recent losses around 90.27, down 0.10% intraday, ahead of Tuesday’s European session. In doing so, the greenback portrays a corrective pullback from the day’s low while stretching Monday’s downside break of an ascending trend line from January 13.
Other than the clear break below the stated support line, sustained trading below 50-day SMA and bearish MACD also favor DXY bears to eye 61.8% Fibonacci retracement of January-February upside, currently around 90.12.
If at all the US dollar bulls fail to return around the key Fibonacci retracement support, the 90.00 threshold adds a filter to the quote’s downside ahead of highlighting the January 13 low of 89.92 and the yearly bottom surrounding 89.20.
On the contrary, the buyers will have to print a daily closing beyond the previous support convergence near 90.40 to regain the market’s confidence.
In a case where the DXY bulls manage to cross 90.40, a downward sloping trend line from January 18, currently around 90.71, will challenge the upside momentum.
Overall, DXY has confirmed further downside on breaking the key support line. Though, 61.8% Fibonacci retracement can filter the moves.
DXY daily chart
Trend: Bearish
