US Dollar Holds in Sideways Range, but Still Below Key Resistance

The US dollar closed at 97.79, with an intraday high of 97.81 and a low of 97.76. Price action remains subdued, trading just under the 97.80–98.00 resistance zone, where moving averages are also converging.

Key Technical Observations

• Moving Averages Flat: The 15-day moving average (97.62) and 20-day moving average (97.71) are nearly aligned, signalling a neutral/sideways bias in the short term. Lack of directional slope shows consolidation.
• Trend Context: The index remains in a longer-term downtrend from its peak above 110, but selling pressure has eased into a range between 97.50 and 99.00.
• RSI Neutral: The RSI is at 50.53, right on the midpoint, showing balance between bulls and bears. Momentum has cooled, with no immediate directional edge.
• Volatility Compression: Candlestick ranges have narrowed, reflecting indecision and low momentum. This often precedes a breakout.

Macro & Market Context

• US dollar Sentiment: The greenback remains pressured by rate cut expectations and softer U.S. growth data.
• Global Risk Flows: Renewed demand for risk assets is capping safe-haven US dollar strength.
• Inflation & Fed Outlook: Traders await upcoming Fed commentary to determine if current consolidation resolves into further weakness or a recovery bounce.

Key Levels to Watch

• Immediate Resistance: 98.00 – short-term ceiling.
• Next Resistance: 99.20–99.50 – psychological and structural barrier.
• Immediate Support: 97.50 – current range floor.
• Breakdown Support: 96.00 – broader downside objective if selling resumes.

Bias: Neutral-to-Bearish

With RSI flat and moving averages converged, the index lacks momentum. Bias leans bearish as long as the price remains capped below 98.50. A decisive break above that zone could shift sentiment back toward 99.00–100.00, while a loss of 97.50 would open the way to 96.00.

• Short-term traders may look for range trades between 97.50 and 98.00 until a breakout occurs.
• Swing traders should watch 97.50 closely – a break lower favours fresh US dollar weakness, aligning with EUR/USD and GBP/USD bullish trends.
• Patience is key – the compression phase suggests a directional move is building.