US Dollar Index Price Analysis: DXY bulls battle seven-week-old resistance line

• DXY extends Friday’s run-up amid US Senate passes one-day stopgap funding with nearly final covid stimulus.
• 10-day SMA adds strength to the immediate upside hurdle.
• Bears can re-enter on the downside break below 90.00.

US Dollar Index (DXY) takes the bids near 90.45, up 0.50% intraday, during early Monday. The greenback gauge bounced off the lowest since April 2018 last Friday amid hopes of the US coronavirus (COVID-19) aid package as the current budget funding reached near expiry.

During the weekend, policymakers at Capitol Hill finalized the details of the much-awaited covid stimulus but couldn’t announce it formally as Sunday ends. However, the Congress members managed to avert the government shutdown while passing a one-day stopgap funding bill.

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In a reaction, the US dollar extends Friday’s recovery moves while battling a downward sloping trend line from November 04 as well as 10-day SMA, around 90.49/53.

While upbeat fundamentals are likely to support the greenback buyers to cross the 90.53 immediate hurdle, a 21-day SMA near 91.07 will challenge the quote afterward.

Alternatively, the 90.00 threshold restricts the sellers’ entries ahead of the recent multi-month low of 89.72.

In a case where the DXY drops below 89.72, April 2018 low near 89.22 will lure the bears.

DXY daily chart

Trend: Further recovery expected