US Dollar Index Price Forecast: Outlook remains bearish below 98.50

• The US Dollar Index recovers to around 98.25 in Friday's early European session. 
• The negative outlook of the index remains in play below the 100-day EMA with a bearish RSI indicator. 
• The first support level to watch is 98.00; the first upside barrier is seen at 99.38.

The US Dollar Index (DXY), an index of the value of the US Dollar (USD) measured against a basket of six world currencies, rebounds to near 98.25, snapping the two-day losing streak during the early European session on Friday. The risk-off mood amid rising geopolitical tensions in the Middle East provides some support to the US Dollar (USD) broadly. 

According to the daily chart, the bearish bias of the DXY remains intact as the index holds below the key 100-day Exponential Moving Average (EMA). Furthermore, the downward momentum is supported by the 14-day Relative Strength Index (RSI), which stands below the midline near 39.50, supporting the sellers in the near term. 

The initial support level for the USD index emerges at 98.00, representing the lower limit of the Bollinger Band and the psychological mark. Further south, the next contention level is seen at 97.61, the low of June 12. The additional downside filter to watch is 96.55, the low of February 25, 2022. 

On the bright side, the first upside barrier for the DXY is located at 99.38, the high of June 10. Any follow-through buying above this level could pave the way to the key resistance level of 100.00. A decisive break above the mentioned level could see a rally to 100.40, the upper boundary of the Bollinger Band.

US Dollar Index (DXY) daily chart