The DXY closed the week pretty overbought imo. RSI at 78.8 is screaming for a pullback. I'm expecting some profit-taking early next week, especially if we don't see any fresh catalysts over the weekend. Looking for a potential short entry around 100.3 if it tests that level again.
And I'm not just looking at RSI, the daily chart also shows a bearish divergence forming. Price made a higher high, but the RSI didn't confirm it. That's usually a pretty reliable signal of a trend reversal. Plus, we have resistance at 100.4 area, which is the R2 pivot point.
I'm not saying it's going to crash, but I'm definitely not convinced this rally can continue much further without a significant correction. I'll be watching closely for a break below 100.00 as confirmation of the bearish thesis. Maybe even a gap down on Monday?
