We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Mixed
Wall Street
Bearish
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Mixed
More View more
US Dollar Weekly Price Outlook: DXY Breakdown Threatens More Losses

US Dollar Weekly Price Outlook: DXY Breakdown Threatens More Losses

2019-01-14 18:00:00
Michael Boutros, Strategist
Share:

In this series we scale-back and look at the broader technical picture to gain a bit more perspective on where we are in trend. The US Dollar Index turned from slope major resistance into the close of 2018 with the recent sell-off breaking below multi-week range support. Here are the key targets & invalidation levels that matter on the DXY weekly chart. Review this week’s Strategy Webinar for an in-depth breakdown of this setup and more.

New to Forex Trading? Get started with this Free Beginners Guide

DXY Weekly Price Chart

US Dollar Index Price Chart - DXY Weekly

Notes: For months now we’ve been tracking resistance in the US Dollar Index along the parallel of the 2011 trendline (red) with the broader long-bias at risk heading into the 61.8% retracement of the 2017 decline at 97.87. Price held a range below this threshold for nearly nine-weeks before breaking below 2018 channel support early in the year.

A close below the 200-week moving average (currently 95.90s) is needed to keep the immediate focus lower with the next major support objective eyed at 93.88 -94.09- a region defined by the 52-week moving average, the 38.2% retracement of the 2018 range and the 2016 low-week close. Resistance now stands with the high-week close at 97.42 with a breach above 97.87 still needed to fuel the next leg higher in the greenback.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Bottom line:The US Dollar Index has turned from a multi-year slope inflection with price now threatening a break of below 2018 uptrend support. IF price is indeed heading lower, advances should be capped by 97.42 with a break lower from here targeting the critical support confluence around the 94-handle. W

Even the most seasoned traders need a reminder every now and then- Avoid these Mistakes in your trading

---

Relevant US Dollar Data Releases

US Dollar Economic Calendar

Economic Calendar - latest economic developments and upcoming event risk. Learn more about how we Trade the News in our Free Guide!

Previous Weekly Technical Charts

Learn how to Trade with Confidence in our Free Trading Guide

--- Written by Michael Boutros, Technical Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.