The U.S. Dollar Index (DXY) is maintaining a clear bearish trajectory, with price action on the H4 chart showing a consistent pattern of lower highs and lower lows inside a descending channel. The technical structure points to continued selling pressure, and recent fundamental developments only reinforce this view.
📰 Key drivers behind the decline:
The latest U.S. CPI data came in weaker than expected, signaling easing inflationary pressure and fueling expectations that the Federal Reserve may cut interest rates sooner than anticipated.
A slight uptick in jobless claims has raised concerns that the U.S. labor market may be losing momentum.
Simultaneously, global players like China and Japan are shifting toward more stable monetary policy, prompting capital flows away from the dollar.
📉 From a technical perspective, DXY has broken below the key 100.817 support zone and is now trading around 99.7. Each attempt at a bullish pullback has been short-lived, with sellers regaining control quickly. The green arrows on the chart indicate potential reaction zones, but the descending channel structure remains firmly intact.
Outlook: If the index fails to reclaim the 100.8 – 101.3 resistance area, there’s a high probability of further downside toward the 98.5 – 98.0 support region.
In short, DXY is under pressure both technically and fundamentally, which explains the current bullish momentum in EUR/USD, GBP/USD, and especially gold (XAU/USD).
📰 Key drivers behind the decline:
The latest U.S. CPI data came in weaker than expected, signaling easing inflationary pressure and fueling expectations that the Federal Reserve may cut interest rates sooner than anticipated.
A slight uptick in jobless claims has raised concerns that the U.S. labor market may be losing momentum.
Simultaneously, global players like China and Japan are shifting toward more stable monetary policy, prompting capital flows away from the dollar.
📉 From a technical perspective, DXY has broken below the key 100.817 support zone and is now trading around 99.7. Each attempt at a bullish pullback has been short-lived, with sellers regaining control quickly. The green arrows on the chart indicate potential reaction zones, but the descending channel structure remains firmly intact.
Outlook: If the index fails to reclaim the 100.8 – 101.3 resistance area, there’s a high probability of further downside toward the 98.5 – 98.0 support region.
In short, DXY is under pressure both technically and fundamentally, which explains the current bullish momentum in EUR/USD, GBP/USD, and especially gold (XAU/USD).
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Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.