FX.co ★ Trading plan for US dollar index on May 11, 2023

Technical outlook:

The US dollar index dropped to the 100.78 low on Wednesday before finding support. The drop was in line with our earlier projection, which was followed by a bullish reversal as well. The index is seen to be trading close to 101.10 at this point in writing as the bulls remain poised to push through 102.00 and 102.50 respectively in the near term.

The US dollar index is carving a larger-degree corrective rally, which has begun from the 100.34 lows as seen on the chart here. The initial upswing between 100.34 and 101.78 was followed by an expanded triangle, which potentially completed around 100.60. Since then, the final leg is unfolding higher towards 102.50 and up to 103.50 levels respectively.

The US dollar index dropped through the Fibonacci 0.618 retracement of its recent upswing between 100.60 and 101.40, having fallen to 100.78. The bulls will be now inclined to remain in control and push prices higher to 102.00 in the near term as projected here. Only a consistent drop below 100.60 will delay matters further.

Trading idea:

A potential rally against 100.00

Good luck!