The US Dollar Index (DXY), which monitors the performance of the US Dollar (USD) against six major currencies, is currently taking a break and trading slightly lower below the 101.00 level on Thursday. This comes before a busy day on the US economic calendar.
The Greenback has not reacted significantly to the recent comments by US President Donald Trump on the Middle East trip, where he expressed hope for successful nuclear talks with Iran and second chances for Yemen and Syria. Following the volatility in the Korean Won (KRW) on Wednesday, traders are anticipating potential currency movements in Asia and signs of the Trump administration negotiating a currency agreement with countries in the region to weaken the US Dollar.
After bouncing off the crucial support level at 100.22 on Wednesday, the US Dollar Index appears to be in a precarious position, with room for either an upside break to 101.90 or a drop below 100.22. The direction will likely be determined by the US economic data releases later on Thursday. If the index breaks above 101.90, it will encounter resistance at the 55-day Simple Moving Average (SMA) at 102.06, a significant level that has previously acted as a base for an inverted head-and-shoulders pattern.
On the downside, the previous resistance at 100.22 has become a strong support level, followed by the year-to-date low of 97.91 and the pivotal level of 97.73. If the index breaks below these levels, further support can be found at 96.94 and the lower end of the new price range at 95.25 and 94.56, which would be the lowest levels seen since 2019.