The US Dollar Index (DXY) has pulled back since its February 14th high but is trading at a massive confluence of support.
In today’s video, I share the key levels to watch and my thoughts on the dollar’s next move ahead of Thursday’s US inflation data.
Let’s get started!
[embedyt] https://www.youtube.com/watch?v=zmdg53MRIcQ[/embedyt]The US dollar (DXY) has pulled back from recent highs following the daily close below 104.45 as we’ve discussed several times on this site.
But is it over for the dollar, or is this a pullback before the next rally?
As mentioned in recent videos, the 103.00 to 103.50 region is critical for the DXY.
The 103.00 level served as support throughout late January, and 103.50 is a resistance-turned-support level for the dollar.
However, today I want to focus on a less obvious key support for the DXY that could have massive implications in March.
If we use the recent highs in 2024 to draw an ascending channel with an anchor point at the December low, you can see that channel support comes in at 103.50.
That intersects with the key horizontal from January.
The DXY appears to be testing the upper part of this support area today, but Thursday’s US inflation data may offer a more substantial retest.
From a purely technical standpoint, I can’t get bearish on the US dollar while the DXY is holding above 103.50 on a daily closing basis.
If it loses that region this week, I’ll change my stance.
But, for now, the DXY continues to carve higher highs and lows, and it’s holding firmly above the 103.50 confluence of support.
Key resistance for the dollar index comes in at 104.45 and 105.00.
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thank you Justin. Great info.