Signs Are Flashing That Dollar Plunge Has Gone Too Far, Too Fast

The dollar’s third straight weekly decline is triggering signals that U.S. currency weakness may be overdone.

The greenback has gone from beating its major peers last year to losses against every one of those currencies this month. That’s pushed one measure of dollar momentum, the relative strength index, to its most extreme in almost four years as the Federal Reserve signaled a slower pace for raising interest rates.