DXY Nearing Significant Point in Price, Time


USD Technical Outlook

  • US Dollar Index (DXY) is nearing the necessary July excessive
  • Time can be an element right here as we head in the direction of the autumn

US Dollar Technical Analysis: DXY Nearing Significant Point in Price, Time

The US Dollar Index (DXY) is nearing the July excessive at 10929, an necessary excessive because the bull cycle seems set to proceed. We might not see the greenback get away and run and not using a set-back, however as we head in the direction of the autumn the anticipation is we are going to see a lot larger ranges.

The timing of this latest spherical of power comes as we head in the direction of a weak time of the yr for shares, and with the S&P 500 trying to have already concluded or very close to finishing a counter-trend summer season rally, we may see the resurgence of dollar-on, risk-off in an enormous method.

The large driver of the DXY is the EUR/USD, accounting for ~57% of the index, and with its preliminary bounce of parity failing we’re seeing parity again in play once more. A bounce, doubtless a smaller iteration this time, may develop in the very near-term, however is seen a prone to fail and result in ranges a lot decrease than parity.

How a lot decrease? The 2000 low at 8231 seems at actual threat of being seen in the comparatively close to future. This would imply a a lot, a lot larger DXY in fact.

Taking it one step at a time, very first thing is first for the DXY – the 10929 excessive. We may even see a failure from there initially, however searching for the pullback to be extra of a shopping for alternative than a reversal sign.

US Dollar Index (DXY) Daily Chart

DXY Chart by TradingView

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—Written by Paul Robinson, Market Analyst

You can observe Paul on Twitter at @PaulRobinsonFX

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