US Dollar Technical Price Outlook: DXY Weekly Trade Levels
- US Dollar technical trade level update – Weekly Chart
- USD rallies back into uptrend resistance- risk for price inflection ahead
- DXY weekly support 104.88, 103 (key), 101.94 – Resistance 107.51-108.09 (key), 109.29, 110.25
The US Dollar Index surged more than 2.5% off the monthly lows with a breakout of the August opening-range taking DXY back into technical resistance. While the technical outlook remains constructive, the immediate advance may be vulnerable here and we’re looking for possible price inflection in the days ahead to validate resumption of broader uptrend. These are the updated technical targets and invalidation levels that matter on the US Dollar Index weekly price. Review my latest Strategy Webinar for an in-depth breakdown of thisDXY technical setup and more.
US Dollar Index Price Chart – DXY Weekly
Notes: In my last US Dollar Weekly Price Outlook we noted that we were on the looking to validate a low in DXY with, “weekly support now seen at the July monthly open / 1999 high at 104.77/88 – an area of interest for possible downside exhaustion IF reached.” The index briefly registered a low at 104.63 before rebounding sharply higher with the rally breaching the monthly opening-range highs on Thursday. The advance is now testing the first major resistance zone at 107.51-108.09– a region defined by the confluence of the 61.8% Fibonacci retracement of the July decline, the yearly high-week close, and the 2001 low. Risk for inflection into this region with a weekly close above needed to keep the immediate advance viable in the days ahead towards the yearly highs at 109.29 and the 78.6% retracement of the 2001 decline at 110.25.
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Bottom line: A breach of the monthly opening-range keeps the focus on a late-month high in the US Dollar Index – that said, the advance is testing initial resistance here. From at trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – losses should be limited to the August open at 105.82 IF price is indeed heading higher on this stretch. Review my latest US Dollar Short-term Price Outlook for a closer look at the near-term XAU/USD technical trade levels.
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— Written by Michael Boutros, Technical Strategist with DailyFX
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