The US Dollar Index (DXY) is seeing a corrective recovery after breaking key short-term support at 102.35 to complete a near-term top. Next key support is seen at the 55-day moving average (DMA) at 100.89, which economists at Credit Suisse look to hold. 

Renewed push higher later on in the year

“DXY has broken below 102.35/30, marking a minor top, and given the location that the market has failed at, we believe this warns that a potentially lengthier pause is likely, as well as a deeper correction lower in the short-term.” 

“Near-term support moves to the 55-DMA at 100.89, which we look to hold to keep the market in a new range and avoid a potentially deeper setback to 100.50/00.”

“The medium-term momentum picture remains supportive and we thus stick with our medium-term bullish outlook and look for an eventual move back above 103.82 post a potentially lengthy consolidation, ahead of a move above the recent high at 105.01.”

“A sustained break above 105.01 would signal a move to 109.25/110.25 over the longer-term.”