Jump to content

USD Technical Analysis: DXY Outlook in the Days Ahead


Recommended Posts

USD TECHNICAL OUTLOOK

  • US Dollar Index (DXY) continues to slide after trend extreme
  • Currently trading around a level that may provide support
Rupee hits record low of 69.61 per USD

USD TECHNICAL ANALYSIS: DXY OUTLOOK IN THE DAYS AHEAD

The US Dollar Index (DXY) is continuing its recent run of weakness as it pulls back sharply from recent highs. The extremes in bullish sentiment suggested the dollar needed to cool off, and so the recent slide isn’t surprising.

The question is, is whether the USD can reassert its bullish ways quickly, or if it will need some time to digest the run before continuing higher. It’s also possible we are seeing a larger reversal, but at this time that appears to have a lower probability than an eventual trend continuation.

In any event, the DXY is trading around its first level of support via a swing low created on May 5 at 102.35. This is below the trend-line extending higher from the late March low, but even though the trend-line has been broken it doesn’t mean we will necessarily see further weakness.

However, if we see the DXY closes on a daily basis below price support then look for weakness to continue with the 102.35 level turning into a potential source of resistance. The next level up could be the backside test of a 20-year trend-line down near 101, but conviction is lacking in that acting as support until we see the DXY trade around it and show bullish price action.

If support at hand can hold and the DXY pushes higher here, then we may be in for a rangebound period of trading that would do the USD some good in terms of building a base for another run higher. Given the big move and extreme bullishness recently surrounding the dollar a little time would do it some good.

US DOLLAR INDEX (DXY) DAILY CHART

DXY daily chart

DXY Chart by TradingView

Resources for Forex Traders

Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

---Written by Paul Robinson, Market Analyst. DailyFX  | 23rd May 2022

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • Saga is positioning itself as a "layer-1 to launch layer-1s" - a mainnet platform that is explicitly designed to empower developers and enable the next 1,000 chains in gaming and entertainment. The core idea is to make it easier for developers to build infinitely scalable decentralized applications (dApps) through Saga's "chainlet" functionality. Essentially, they are customizable Layer 1 blockchains that can be deployed and operated within the Saga network. These chainlets share the same validators and security model as the Saga mainnet, providing developers with a robust and interoperable infrastructure to build on. The ability to rapidly deploy customized, scalable chains is a game-changer for blockchain gaming, and I can see Saga attracting a lot of attention from leading studios and indie developers alike. With the Bitget listing, SAGA tokens are now tradable on a major global exchange. This presents a fantastic opportunity for the project to increase its visibility and accessibility to a wider audience of investors and enthusiasts. Bitget's deep liquidity and advanced trading features should make it easier for both institutional and retail players to gain exposure to Saga.
    • I have not been a fan of either of exchanges and wallets native tokens but would wanna explore it now. I took interest from the current hype around BNB, OKB and BGB. These tokens particularly BNB and BGB has shown strength which is obviously due to increase in demand to take part in the most of the launchpool. BNB rose almost 80% in the past 1 year, BGB was on the spotlight with about 190% in a year. OKB may not be left out due to it's potential but has made any significant movement recently. Wallet tokens on the hand have also been doing well but may not be compared to Centralized exchanges imho; I have also monitored few wallet particularly trust wallet and C98 wallet. My best guess is we could be seeing the wallet tokens making impressive price action as we approach post halving due to increase in transactions and I wonder if any one here is considering the prospect BWB token for Bitget wallet. Launching pretty soon and airdrop participation in play. I would appreciate your speculative opinion on it potentials.
    • In the realm of cryptocurrency exchanges, playing by the rules isn’t just a suggestion—it’s a must for staying in the game. Most major centralized exchanges (CEXs) strive to adhere to these regulations, implementing measures to prevent money laundering and illicit activities. However, a recent controversy has emerged with BingX, a top CEX, defying US sanctions by allowing Iranian users full access to its platform. BingX facilitates Iranian Rial trading, directly violating US sanctions. They allow Iranian users to trade cryptocurrencies without KYC verification. This, along with offering peer-to-peer (P2P) transactions using Iranian fiat currency, further raises red flags. This incident is reminiscent of the past troubles faced by giants like Binance, who were caught facilitating transactions for sanctioned individuals, resulting in a $4.5 billion plea deal with US authorities in 2023. The question remains: will this defiance by BingX lead to its downfall? Regulatory bodies in the US, like the SEC or DOJ, might take action.However, the severity of the situation raises questions about the long-term viability of the exchange and whether it may face the prospect of closure or severe penalties for its actions. As governments grapple with the complexities of digital assets, CEXs that prioritize expansion over compliance will likely face increasing scrutiny and potential consequences.  
×
×
  • Create New...
us