The U.S. Dollar Index fell to 98.78 on Monday, extending losses from the prior session as technical indicators signaled oversold conditions. The index, which tracks the greenback against a basket of major currencies, has declined roughly 1.2% over the past week, pressured by shifting global risk sentiment and expectations of softer U.S. economic data.
Technical analysis points to a bearish bias, with the Relative Strength Index (RSI) at 23.6, well below the neutral 50 threshold. The Average Directional Index (ADX) remains elevated at 39.6, indicating persistent downward momentum. A bear flag pattern has formed, with completion estimated at 80% just below major resistance between 99.80 and 100.00.
Traders are closely watching the 99.30–99.20 volume zone, a break below which could accelerate selling pressure. The 99.40–99.80 range is described as a no-trade zone due to choppy price action and whipsaw risk. On the upside, a sustained move above 99.90 could trap bulls, while a clean break above 100.10 would shift control to the upside.
Bearish scenarios suggest potential downside targets at 99.30, 98.70, and 98.00, with entry points at 99.80 or 99.25 and stops set above 100.05. Conversely, a bounce at 99.35 or a close above 100.15 could trigger short-covering rallies targeting 99.85, 100.10, or 100.50. Invalidation levels remain at 100.10 for bulls and 99.15 for bears.
