Is the U.S. dollar done falling against its major counterparts?
The U.S. Dollar Index (DXY) is pointing to a ranging environment!
Try what the 4-hour chart is telling us:
US Dollar Index (DXY): 4-hour
US Dollar Index (DXY) 4-hour Forex Chart by TradingView
If you happen to’re trying to trade USD pairs this week, it is best to know that the dollar might gain a pip or two (or 100) against its major counterparts this week.
Or not. It could rely upon the general market environment.
So far as technicals are concerned, the dollar is approaching a serious support level on the 4-hour timeframe. DXY is near the 103.50 zone that attracted enough bulls in mid-December and again in the beginning of the 12 months.
Will the range support hold for one more day? Or is third time the charm for USD bears?
Flatter easy moving averages (SMAs) on the 4-hour chart suggest that USD could also be ranging somewhat than trending in the subsequent couple of days.
Stochastic is a little more specific, saying that DXY is currently “oversold” on the 4-hour timeframe.
If this week’s U.S. inflation reports or Powell’s panel discussion in Stockholm point to the Fed sticking to its hawkish plans for the 12 months, then USD could gain ground across the board.
DXY could bounce from its 103.50 range support and test the 100 SMA, 104.50 mid-range, or 106.00 range resistance levels.
But when this week’s market themes find yourself being good for risk-taking, then safe-haven USD would lose pips against its counterparts.
DXY could resume its decline and doubtless revisit its 102.50 or 101.70 previous areas of interest.
What do you’re thinking that? Will DXY trend this week? Or will it stay inside a spread?
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