The dollar index found strong resistance around the 97.20 obstacle, driving the price lower. Currently, the price has been developing in a sideways channel over the past five months with upper boundary the 97.50 resistance and lower boundary the 94.60 support. Chances for a reversal in the short-term are increasing as the price failed to drop beneath the 50-day simple moving average (SMA).
The short-term bias looks positive as the RSI indicator keeps gaining ground above its 50 level, while the stochastic oscillator is ready for a bullish crossover within the %K and %D lines near the oversold zone.
The 23.6% Fibonacci retracement level of the upward movement from 88.10 to 97.50 around 95.28, which overlaps with the 200-day SMA could be a trigger point for bearish actions if the index manages to slip below 50-day SMA. If the price continues to drop, support could next come somewhere between 94.85 and 94.60, the lower boundary of the range.
However, if the price continues the latest slightly bullish move, investors could find resistance near the 97.20 barrier and then at the 97.50 strong obstacle, which halted bullish movement at the end of the previous year.
Overall, the dollar index seems to be neutral and only a drop below 94.60 could change the neutral outlook to bearish. On the other side, a jump above 97.50 could switch the recent view to bullish.