US Dollar Index Price Analysis: DXY flirts with weekly support of 103.80

• US Dollar Index seesaws near short-term key support after falling the most in a week.
• Nearly oversold RSI, sluggish MACD signals also challenge DXY bears.
• Bearish channel keeps sellers hopeful of witnessing further downside.

US Dollar Index (DXY) stays defensive near 103.90 as DXY bears take a breather following the biggest daily slump in a week. In doing so, the greenback’s gauge versus the six major currencies flirts with a one-week-old ascending support line.

It should be noted that the RSI (14) is near the oversold conditions and hence suggest the quote’s limited downside, highlighting the aforementioned support line near 103.80 as a reversal point. Also challenging the DXY bears are the sluggish MACD signals, mildly positive of late.

In a case where the US Dollar Index drops below 103.80, a five-week-old bearish channel’s lower line, close to 102.95 by the press time, will gain major attention ahead of May’s low near 101.30.

On the contrary, DXY recovery needs validation from the 10-DMA hurdle of 104.44 to challenge the bearish chart pattern, which in turn highlights the aforementioned channel’s top line, close to 105.50 at the latest.

Should the US Dollar Index manage to cross the 105.50 key resistance, the recovery moves won’t hesitate to aim for the monthly high of 106.00.

Overall, DXY remains bearish but a corrective bounce can’t be ruled out.

US Dollar Index: Daily chart

Trend: Bearish