US Dollar Price Technical Outlook: DXY Weekly Trading Levels

  • we DollarTrade Technical Level Update – Weekly Chart
  • USD attempts vulnerable fifth early weekly rally as it falls below key technical resistance
  • DXY weekly support to 93.76, 92.48 (bullish cancelation) – To touchresistance 94.47 / 65.95.15

The US dollar index is virtually unchanged (+ 0.02%) this week, with DXY holding just below technical resistance for a second week. While a breakthrough of the year aperture range maintains the broader upward-weighted outlook, the advance may be stalled here as prices struggle to close a fifth consecutive weekly advance. These are the updated technical goals and invalidation levels that count on the weekly US Dollar Index price chart. Review my last Strategy webinar for an in-depth analysis of this DXY technique configuration and more.

US Dollar Index Price Chart – Weekly DXY

Graphic prepared by Michel Boutros, technical strategist; US dollar index on Tradingview

Remarks: In my last Weekly Price Outlook in US Dollars we noted that the breakout of the DXY had: “The breakout of the US dollar has extended to major technical resistance here at new annual highs and the focus is on a possible price inflection just higher.” The target level was 94.47 / 65– a region defined by 38.2% Fibonacci retracement of 2020 low and March 2020 low. Price recorded a high at 94.50 before retreating with the DXY equilibrium to mark a weekly doji this week. Is the rally at a standstill?

Initial weekly Support look now 93.76 / 88 with key / short-term support bullish invalidation now increased to lower parallel / 38.2% retracement of annual range to 92.48. An upward breach / closure above the Median line exposing the subsequent goals to the swing highs of October / November 2017 at 95.15 and critic resistance confluence at 96.10 / 50. Note that the original slope of 2011 (red) also converges to this region and further emphasizes the technical importance of this area – expect a bigger / more significant price reaction if it is reached.

For a full description of Michael’s trading strategy, see his Fundamentals of Technical Analysis Series on Building a Trading Strategy

At the end of the line : The The breakout of the US dollar could stagnate here in resistance to the uptrend and while the broader focus remains constructive, the immediate advance could be vulnerable in the coming weeks. From a trading perspective, a good area to reduce long exposures / increase protective stops – be on the lookout for downside exhaustion before the uptrend support on pullbacks with a higher breach from from here likely to fuel another accelerated advance towards the upper parallels. I will post an update Price Outlook in US Dollars once we have more clarity on the short term DXY technical trading levels.

Key data publications in the United States

US Dollar Technical Outlook: Five-Week USD Rally Stalls At ResistanceUS Dollar Technical Outlook: Five-Week USD Rally Stalls At Resistance

Economic calendarthe latest economic developments and the risks associated with future events.

Previous weekly technical charts

— Written by Michel Boutros, Technical strategist with DailyFX

To follow Michael on Twitter @MBForex

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