USD Rises to New High DXY Levels in 2021

US Dollar Price Technical Outlook: DXY Weekly Trading Levels

  • we Dollar Trade Technical Level Update – Weekly Chart
  • USD Marks 4th Vulnerable Weekly Early Rally in Key Resistance Pivot Just Higher
  • DXY weekly support to 92.48 (bullish cancelation) – To touchresistance 94.47 / 65.95.15

The US dollar index jumped over 1% this week with a four-week winning streak taking the DXY to new annual highs. The rally is now aiming for a major resistance pivot just higher and the focus is on a possible price inflection with the wider advance vulnerable to the March 2020 lows. These are the updated technical targets and levels. ‘invalidation that rely on the weekly price chart of the US dollar index before the October open. 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 DXY rally had “failed just before major technical resistance and the threat of a deeper pullback remains below 93.76 / 88. From a business perspective, look for possible downside depletion before 91.74 The SI price is indeed rising with a break / close above the midline ultimately needed to mark the resumption of the wider uptrend. The price hit a low of 91.94 the following week before reversing higher with a breakout this week pushing the index into a confluence of major resistance at 94.47 / 65– a region defined by 38.2% Fibonacci Retracement of 2020 low and March 2020 low. The immediate advance may be vulnerable at this threshold before the October / Q4 open.

Initial weekly Support now rest at 93.76 closely supported by the August high week close at 93.45 with wider bullish invalidation now increased to lower parallel / 38.2% retracement near ~92.50. An upward breach from here maintains focus on October 2017 swing highs to 95.15 and a more important resistance range at the 50% retracement / 2020 annual open to 96.10 / 50– look for a stronger price reaction if it is achieved.

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 has extended to major technical resistance here at new year-on-year highs and the focus is on possible price reversal just upward. From a trading perspective, look to reduce long exposures / increase protective stops on a test of the 94.47 / 65 resistance zone – losses should be limited to fork IF support the price is indeed heading higher with a breach / close above the midline needed to fuel the next higher step in price. Keep in mind that the index has now cleared the annual aperture range highs and maintains focus on a high price in the fourth quarter. Review my last Price Outlook in US Dollars for a closer look at short term DXY technical trading levels.

Key data publications in the United States

US Economic Calendar - USD Weekly Event Risk - Key Data Releases

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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