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DXY in detail What is DXY ? The U.S. Dollar Index (DXY) is a measure of the value of the U.S. dollar relative to a basket of six major foreign currencies. It is a weighted geometric mean of the exchange rates between the U.S. dollar and these currencies. The DXY was created in 1973 with a base value of 100 and serves as a benchmark to assess the strength of the U.S. dollar in comparison to other global currencies. The basket of currencies and their respective weightings in the DXY are as follows: Euro (EUR) - 57.6% Japanese Yen (JPY) - 13.6% British Pound Sterling (GBP) - 11.9% Canadian Dollar (CAD) - 9.1% Swedish Krona (SEK) - 4.2% Swiss Franc (CHF) - 3.6% The weights assigned to each currency in the formula are based on the trade weights of the currencies, which reflect the importance of each currency in international trade. An analogy to explain DXY could be imagining a shopping cart filled with distinct items, each with a different price tag. The DXY is like the total value of the items in the shopping cart, where each item represents a currency in the basket. Just as the total value of the items in the shopping cart can fluctuate based on the price of each item, the value of the US dollar in the DXY can fluctuate based on the exchange rate of each currency in the basket. For example, if the exchange rate of the euro, yen, and other currencies in the basket decrease relative to the US dollar, the value of the US dollar in the DXY would increase. Conversely, if the exchange rate of these currencies increases relative to the US dollar, the value of the US dollar in the DXY would decrease. Following is how it's precisely calculated: The DXY, is calculated as a weighted geometric mean of the US dollar's value relative to the six major currencies in the basket. The formula to calculate the DXY is: DXY = 50.14348112 × EURUSD^(-0.576) × USDJPY^(0.136) × GBPUSD^(-0.119) × USDCAD^(0.091) × SEKUSD^(0.042) × CHFUSD^(0.036) where: EURUSD is the exchange rate of the euro to the US dollar USDJPY is the exchange rate of the yen to the US dollar GBPUSD is the exchange rate of the British pound to the US dollar USDCAD is the exchange rate of the Canadian dollar to the US dollar SEKUSD is the exchange rate of the Swedish krona to the US dollar CHFUSD is the exchange rate of the Swiss franc to the US dollar As an example, let's say that on a particular day, the exchange rates of the currencies in the basket are: EURUSD = 1.2000 USDJPY = 110.00 GBPUSD = 1.4000 USDCAD = 1.2500 SEKUSD = 0.1200 CHFUSD = 0.9000 To calculate the DXY for this day, we would plug these values into the formula and solve: DXY = 50.14348112 × 1.2000^(-0.576) × 110.00^(0.136) × 1.4000^(-0.119) × 1.2500^(0.091) × 0.1200^(0.042) × 0.9000^(0.036) DXY = 90.546 I have over 6 years of trading and investing experience and have learned a lot in this time. I like to share what I have learned and if you like my content and would like to learn from my experience hit like and follow me for getting notified on my trade, market projections and several upcoming tutorials on technical analysis and several technical Indicators. you can also leave a comment and let me know if you want me to analyze any specific asset or want to learn about any specific topic in the world of Technical Analysis. I Will do my best to create a post for it. Keep learning and Happy trading All.
TVC:DXY
by zakoraio
DXY: Event influence!Hello traders, I have some USD related information to share with you ♥ US Dollar's position as the primary global reserve currency is being challenged The US Dollar's share of the global market has decreased from 71 percent to 59 percent over the last two decades and could shrink even further in the future. The primary victim in this scenario is the United States, as currency usage in global trade is a zero-sum game. Each time a Yuan, real, or Rupee is exchanged on the global market, a Dollar is not. If credible alternatives gain steam, the dominance of America in the global market will be compromised.
TVC:DXYShort
by Sphyn-Trader
2
#DXY- BUY XXXUSD to catch Big Moves!!Dear Traders, following yesterday data on NFP we have now identified that USD pairs will be bullish for longer time as fear of recession has risen again, from negative NFP to increasing tax on Capital gains, everything indicating towards a negative DXY; we also have CPI next week which will be interesting and important for the investors and traders. It will be better to leave USD pairs alone on Monday where we will have a better understanding of the price action. Please Like and Follow for more
TVC:DXYShort
by Setupsfx_
17
DXY Trading Plan - 30/mar/2023Hello Traders, Hope you all are doing good!! I expect DXY to go Up after finishing this correction. Look for your BUY setups. Please follow me and like if you agree or this idea helps you out in your trading plan. Disclaimer: This is just an idea. Please do your own analysis before opening a position. Always use SL & proper risk management. Market can evolve anytime, hence, always do your analysis and learn trade management before following any idea.
TVC:DXYLong
by For3xScalper