USD Index Price Analysis: Further consolidation looks likely short term

The index gives away part of Monday’s decent advance.
Extra range bound around current levels appears favoured.

The auspicious start of the week for the greenback was short lived, as DXY sheds part of the recent gains on Tuesday.

So far, the continuation of the side-lined mood looks like the name of the game for the dollar, at least in the near term.

In case bears regain the upper hand, the loss of the January low at 101.98 (January 13) should put a potential deeper drop to the May 2022 low around 101.30 (May 30) back on the investors’ radar prior to the psychological 100.00 level. On the upside, there are no hurdles of note until the January high at 105.63 (January 6).

In the meantime, while below the 200-day SMA at 106.41 the outlook for the index should remain tilted to the negative side.