• DXY fades part of Friday’s rebound and retests 104.20.
• The 4-monht line near 101.70 props up the upside bias.

DXY resumes the leg lower and leaves behind Friday’s bullish attempt.

Considering the ongoing price action, further correction should not be ruled out in the short-term time frame. That said, another visit to the post-FOMC low near 103.40 (June 16) is expected to remain on the cards, although this and a potential deeper decline could be deemed as buying opportunities.

As long as the 4-month line around 101.20 holds the downside, the near-term outlook for the index should remain constructive.

Looking at the longer run, the outlook for the dollar is seen bullish while above the 200-day SMA at 97.61.

DXY daily chart