- DXY corrects lower from weekly tops just above 91.00.
- The 90.00 region is expected to hold sellers near-term.
After clinching weekly tops in levels just past the 91.00 barrier, the dollar now faces increasing selling pressure and drags DXY to the 90.30 region.
Below this area emerges the psychological support at 90.00, which coincides with the key 2020-2021 support line. A breach of this psychological level should open the door to a visit to the 2021 lows around 89.20 (January 6) ahead of the March 2018 low at 88.94.
In the meantime, occasional bouts of upside pressure in the index are deemed as corrective only amidst the broader bearish view on the dollar. That said, bullish attempts to the 91.00 hurdle and beyond could represent selling opportunities against the current backdrop.
In the longer run, as long as DXY trades below the 200-day SMA (93.36), the negative stance is expected to persist.
DXY DAILY CHART