Technical outlook:

The US dollar index dropped through the 103.20 lows intraday on Thursday before finding interim support. The index is seen to be trading close to 103.40 at this point in writing as a 30-pip trading range continues for the day.The bears are expected to drag prices down towards 102.00 and lower to 101.50 in the near term. Ideally, prices stay above 100.50 interim lows.

The US dollar index has already carved a larger-degree bearish wave between 114.70 and 100.50 in the past several weeks. The above boundary is being worked upon as prices continue to retrace higher towards 106.50 and up to 109.50 in the medium term. Within the above corrective rally, the bulls might have completed the first wave close to 103.50.

If the above-proposed wave structure holds well, prices would drop towards 105.50-60 to find support and turn higher thereafter. On the flip side, a break above 103.50 from here will open the door towards the 105.35 initial resistance. Also, note that potential remains for a rally through 109.50, which is the Fibonacci 0.518 retracement of the above drop.

Trading idea:

Potential rally against 100.50.

Good luck!