Dollar Index Holds Above 101.76 as Sterling and Euro Struggle for Recovery

The US dollar index is holding above its 101.76 support level, keeping the bias tilted to the upside even as the pound and euro battle to recover from recent losses. GBP/USD trades at 1.3207 after failing at 1.3284, while EUR/USD sits at 1.1198 on the two-hour chart, below its moving averages and a descending trendline.

Dollar Index Faces Resistance at 102.49

The first resistance for the dollar index sits at 102.49. A break above that level would open the door to 102.70 and then 102.95. On the downside, the lower support zone runs from 102.00 to 101.76. If that zone gives way, 101.49 and 101.16 become the more likely targets.

The RSI is currently in the middle, which is a relief from the overbought condition seen earlier. The bias stays to the upside as long as the dollar index holds above 101.76 and the rising trendline. A breakdown of 101.49 would raise the likelihood of a move toward 100.40. Conversely, a move above 102.49 would increase the odds of a push toward 102.70 and 102.95.

Sterling Loses Support at 1.3222

GBP/USD hit resistance at 1.3284 and failed to break a descending trendline, which pushed the pair back to the downside. The 1.3222 level has also lost support, along with the moving averages, which continue to trend higher.

Support sits at 1.3180. A break below that would bring 1.3147 into play, followed by 1.3113. On the upside, 1.3222 acts as first resistance, with 1.3284 and 1.3324 providing further resistance levels.

The RSI is in the lower range, pointing to a slight tilt toward the sell side. Price remains below 1.3222 and 1.3284, as well as the descending trendline. That keeps the case for selling rallies. A move through 1.3284 would shift the attitude toward the trendline and the bull side. A break below 1.3180 would give way to 1.3147.

Euro Stays Under Bearish Control

EUR/USD is trading firmly below both moving averages and the descending trend line on the two-hour chart. The recent bounce could not take out 1.1212, keeping the larger bearish structure in place and leaving control with sellers.

The first support area is 1.1161. If price breaks that level, 1.1115 is the next area of support, followed by 1.1063. The first resistance sits at 1.1212, followed by 1.1272 and then 1.1334 if buyers can launch a larger move to the upside.

The RSI remains below the midline, indicating that the larger timeframe trend stays bearish. The bearish bias holds as long as 1.1212 and the descending trend line continue to cap price. A break above 1.1272 would be bullish, while a break below 1.1161 would confirm 1.1115 as the next support area.

A firmer dollar index typically pressures emerging market currencies, including the naira. Nigerian importers and businesses holding dollar obligations will be watching whether the index clears 102.49 or slips below 101.76, since that direction often sets the tone for short-term exchange rate pressure.