FX.co ★ Technical analysis on the Dollar index for January 13th, 2023.

Violet lines- Fibonacci retracement levels

Black line- bullish RSI divergence

The Dollar index is making new lower lows. Price has reached the 50% Fibonacci retracement of the entire rise since the 89.18 low from January of 2021. Next major support is at the 61.8% retracement level at 98.90 price level. The RSI continues to provide bullish divergence signals. Technically trend remains bearish, so far there is no sign of a reversal. Bears remain in control of the trend. The RSI indicator suggests that the downside is limited and a bounce is needed first. However the bullish divergence by the RSI is not a reversal signal but only a warning. Several times before this kind of warnings were cancelled. Traders need to be extra cautious.