The U.S. Dollar Is Breaking Major Levels
While everyone is focused on the meltdown in technology stocks and bond prices, the U.S. dollar is hitting even more historic levels to the upside.
The U.S. Dollar Index started moving in late 2021 as the Federal Reserve got more hawkish. It accelerated after Russia invaded Ukraine and has continued upward every week since the end of March.
The main pattern on today’s chart is the high around 103.80 where DXY peaked in January 2017. That was a major level because it marked the index’s highest level in over a decade. Prices consolidated in that area for the last two weeks before pushing above it early this morning.
It could be an important event if the breakout holds because DXY is now back to its highest level since December 2002. Continued upside could further hurt risk appetite in the equity and crypto markets. It could also weigh on megacap Nasdaq companies with significant global operations. (A stronger greenback can lower the value of international revenues.)
Traders might want to keep an eye on this chart – especially with the Fed still battling inflation and Europe’s economy under pressure.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing in cryptocurrencies involves significant risks. Please click here for TradeStation Crypto’s risk disclosures on investing and trading in cryptocurrencies.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
The U.S. Dollar Index started moving in late 2021 as the Federal Reserve got more hawkish. It accelerated after Russia invaded Ukraine and has continued upward every week since the end of March.
The main pattern on today’s chart is the high around 103.80 where DXY peaked in January 2017. That was a major level because it marked the index’s highest level in over a decade. Prices consolidated in that area for the last two weeks before pushing above it early this morning.
It could be an important event if the breakout holds because DXY is now back to its highest level since December 2002. Continued upside could further hurt risk appetite in the equity and crypto markets. It could also weigh on megacap Nasdaq companies with significant global operations. (A stronger greenback can lower the value of international revenues.)
Traders might want to keep an eye on this chart – especially with the Fed still battling inflation and Europe’s economy under pressure.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. You Can Trade, Inc. is also a wholly owned subsidiary of TradeStation Group, Inc., operating under its own brand and trademarks. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing in cryptocurrencies involves significant risks. Please click here for TradeStation Crypto’s risk disclosures on investing and trading in cryptocurrencies.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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