Dollar Index – Maintains Bullish Bias Above Daily Cloud, US Inflation Data in Focus

The dollar index regained traction on Tuesday, edging higher after a 0.4% drop on Monday.

The pullback was contained by the top of the daily cloud, representing a mild correction within a larger uptrend that remains intact.

The technical outlook on the daily chart remains bullish, with moving averages in a bullish setup, strong positive momentum, and price action supported by the daily cloud.

Markets are now focused on the release of US inflation data (PCE) on Friday, seeking more clues about the Fed’s rate path, which is expected to significantly influence the dollar’s performance.

Attention will also be on the first debate of US presidential candidates, the French election, and geopolitical developments, especially with recent indications that the conflict may spread to Lebanon.

The near-term bullish bias is expected to hold above the 105.00 support (cloud top / 10DMA), aiming for a renewed attempt towards 105.71 (Fibo 76.4% of 106.36/103.61). A loss of the 105 handle would weaken the structure, risking a deeper drop towards 104.47/28 (100 / 200DMA respectively).

Res: 105.54; 105.71; 106.00; 106.36
Sup: 105.00; 104.78; 104.47; 104.28