The U.S. Dollar closed higher against a basket of major currencies on Friday, taking back some of the previous session’s loss, nonetheless, the move wasn’t strong enough to erase its weekly loss. The catalyst behind the rally was another spike in U.S. Treasury yields early in the session. The greenback gave back nearly half of its earlier gains after yields retreated from their highs late in the session.

On Friday, June U.S. Dollar index futures settled at 91.677, up 0.262 or +0.29%.

Early in the week, the dollar index touched its highest level since November 23 before selling off. Despite a boatload of calls for a weaker dollar in 2021 at the start of the new year, the greenback is now up 2.00% for the year.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum has been trending lower since the formation of the closing price reversal top on March 9.

A trade through 92.530 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a move through 89.655.

The minor trend is also up. A trade through 91.340 will change the minor trend to down. This move will confirm the shift in momentum.

On the upside, potential retracement level resistance comes in at 91.870, 92.200 and 92.510.

On the downside, potential retracement level support comes in at 91.620 and 91.350.

The short-term range is 89.655 to 92.530. Its retracement zone at 91.095 to 90.755 is the best downside.

Short-Term Outlook

The early direction of the June U.S. Dollar Index on Monday is likely to be determined by trader reaction to the 50% level at 91.620.

Bullish Scenario

A sustained move over 91.620 will indicate the presence of buyers. This could lead to a labored rally due to a series of potential resistance levels at 91.870, 92.200, 92.510 and 92.530.

Bearish Scenario

A sustained move under 91.620 will signal the presence of sellers. This could trigger a labored break into a series of potential support levels including a price cluster at 91.350 – 91.340, and a short-term retracement zone at 91.095 to 90.755.

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This article was originally posted on FX Empire

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