The US dollar index continues to hold within negative territory as it posted its tenth bearish day in a row on Tuesday. The price has plummeted more than 2% since December 2 and challenged a new more than 3-month low at 91.44.
In the short-term timeframe, the index is trading slightly above the aforementioned level, however, a break below it could expose the price towards the 90.95 support level, which is standing since September 8. Conversely, a retracement on the upside could open the door for the next resistance level at 92.40.
Remaining on the short-term timeframe the Relative Strength Index (RSI) is moving within the oversold zone but is close to exiting it as approaches the 30 level. As a result, the strong bearish momentum has weakened. The MACD oscillator has also lost some of its strong downside momentum and is holding near the trigger line, ready to post a bullish crossover in the bearish area. The three simple moving averages (50, 100 and 200) are moving southwards endorsing the scenario for further fall in the next sessions. However, traders need to be ready for a possible upwards correction before the potential resumption of a downward movement.
The past year marked the worst year for the US dollar in more than a decade with the dollar index falling over 10%. The last time it faced such difficult times was in 2003 when it lost 14.6% of its value.
