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Dollar index holds support near 99.5 after last week’s 1.5% drop
The index is consolidating just above a seven-week low, with traders cautious ahead of news on US-Iran peace talks and a key test near the 100 level.
The U.S. dollar index is trading in a tight consolidation above a seven-week low and remains biased lower after falling 1.5% for the week, Action Forex reports.
Near-term price action has been contained by support around the 99.5 area, tied to the 50% retracement of 97.44 and 101.55, along with the 100-day moving average. The publication notes daily technical studies remain predominantly bearish, with negative momentum and multiple moving average bear-crosses.
Action Forex says traders are also watching uncertainty around Middle East developments and media reports about peace talks. The dollar could face fresh pressure if peace talks succeed, while a stall in the most recent US-Iran agreement would keep the market wary.
Looking ahead, the outlet highlights that a firm break of the 99.5 support zone could signal bearish continuation, with downside targets at 99.0 and 98.41. It also flags that breaking the psychological 100 level would be important, and that more bullish follow-through would require confirmation with a move above the 55-day moving average near 101.23.
Latest closeDollar index 99.69 ▼0.2%