FX.co ★ Trading plan for US dollar index on November 16, 2022

Technical outlook:

The US dollar index slipped below the 105.00 handle on Tuesday before quickly recovering towards 106.70. The index is correcting lower since then and is seen to be trading close to 105.60 at this point in writing. The possibility remains for yet another shallow low towards 104.20 before turning higher again. A push above 108.70 from here confirms a meaningful bottom is in place though.

The US dollar index seems to have completed its corrective drop, which began from 114.67 earlier at the 104.90-95 levels or it is close to terminating. The drop towards 104.90-95 unfolded in three waves, hence corrective, which leaves for the bulls to come back in control and push towards fresh highs sooner than later. A break above 112.65 confirms that prices are towards a new high.

The US dollar index has further carved a pin bar candlestick pattern on the daily chart after dropping towards 104.95 on Tuesday. It could be seen as an indication of a bullish turn against the low. The bulls are looking poised to push prices towards 110.60 in the near term, which is also an immediate price resistance.

Trading idea:

Potential rally towards 110.65 and higher against 104.95

Good luck!