The US Dollar is clearly back on defense considering the DXY Index has been drilled lower for its third consecutive session. US Dollar downside was broad based during Thursday trade with weakness shown across practically all major currency pairs.
The broader DXY Index has gravitated lower correspondingly and now hovers around a confluence of technical support formed from prior resistance. US Dollar weakness has also coincided with the relative strength index recoiling lower after probing ‘overbought’ territory.
US Dollar bears appear to be wrestling back control and might have their eyes set on the 20-day and 50-day simple moving averages. Breaching this next possible layer of defense could open up the door for a deeper reversal toward the 89.50-price level. On the contrary, if there is another flareup in risk aversion or sharp rise in Treasury yields.