US Dollar Index Price Analysis: Further correction stays on the table

• DXY gives away part of Monday’s intense move above 114.00.
• Corrective move is expected to persist in the near term.

DXY comes under pressure and sheds some ground following recent cycle highs near 114.50 (September 26).

In the meantime, extra losses appear favoured in the current context of overbought levels and could extend further in the very near term at least.

That said, occasional bouts of weakness could be deemed as buying opportunities with the immediate target now emerging at the round level at 115.00 ahead of the May 2002 high at 115.32.

The prospects for extra gains in the dollar should remain unchanged as long as the index trades above the 7-month support line near 106.90.

In the longer run, DXY is expected to maintain its constructive stance while above the 200-day SMA at 102.21.

DXY daily chart