US Dollar Index Price Analysis: Further retracement not ruled out

• DXY drops further and breaches the 94.00 support.
• Further losses could retest the 93.70 region near term.

DXY trades on the defensive for the third session in a row and breaks below the key support at the 94.00 yardstick.

In light of the ongoing price action in the index, the possibility of extra declines remains well on the table in the very near term.  That said, a deeper correction is then expected to meet the next contention area near 93.70, where August’s high sits. The 10-day SMA a 93.66 reinforces this area of initial contention

Looking at the broader picture, the constructive stance on the index is seen unchanged above the 200-day SMA at 91.59.

DXY daily chart