Investors originally sought the currency for safety, but shifting geopolitical hopes recently cooled that bullish momentum.
The dollar index, tracking six major counterparts, recently shed 3% from its late March peak of 100.64.
Prices nearly plummeted further this month, briefly dipping below the crucial April low of 97.63.
However, the greenback regained ground after strong inflation data and stalled diplomatic progress boosted its appeal.
The currency climbed above the 23.6% Fibonacci retracement on Tuesday, a level traders watch for trend shifts.
Market analysts typically view this specific technical marker as a temporary pause before the previous downward slide continues.
Establishing a firm foothold above 98.335 would signal a significant recovery toward the 99.488 range.
Conversely, a daily close below 97.623 likely triggers further losses, potentially dragging the index toward 96.492.
