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Initial support is seen around 92.50

  • The DXY gives up some of the recent advance.
  • Weakness should find support around 92.50.

The U.S. dollar index (DXY) retreats some ground after two consecutive daily advances and another failed attempt to move above 93.00.

There will likely be more range travels around current levels ahead of the week’s key event than the Federal Reserve meeting on Tuesday and Wednesday. To the upside, there is a temporary hurdle at the monthly highs near 93.20 (July 21 high) ahead of the 2021 high in the 93.50 area.

Looking at the broader picture, the positive stance on the dollar is expected to remain unchanged as the index trades above the 200-day SMA, today at 91.35.

The index, however, is navigating the limits of overbought territory, which could trigger some correction in the not-too-distant future.

DXY day chart

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