Technical Analysis: US Dollar Index on Track to Break Out

Wednesday, 22/07/2015 | 22:57 GMT by Victor Golovtchenko
  • U.S. dollar strength is back on the table as the Federal Reserve prepares to increase interest rates in September
Technical Analysis: US Dollar Index on Track to Break Out
Web_Carlson_7567

Ed Carlson

The previous Friday’s expected low cycle was successful in starting a rally last week in which the US dollar had its best week since May. DXY gained 1.89% to close at 97.99 above the June 1 high and printed an engulfing bullish candlestick on the weekly chart.

A cup-and-handle pattern has been triggered (chart) and measures a minimum rally to 101.00. A symmetrical triangle on the monthly chart (not shown) measures a minimum move to 102.00 which is the 61.8% retracement of the 2002 bear market. 102.00 is also a 127.2% retracement of the April/May decline (chart).

7.21.15dxy_cnh
Web_Carlson_7567

Ed Carlson

The previous Friday’s expected low cycle was successful in starting a rally last week in which the US dollar had its best week since May. DXY gained 1.89% to close at 97.99 above the June 1 high and printed an engulfing bullish candlestick on the weekly chart.

A cup-and-handle pattern has been triggered (chart) and measures a minimum rally to 101.00. A symmetrical triangle on the monthly chart (not shown) measures a minimum move to 102.00 which is the 61.8% retracement of the 2002 bear market. 102.00 is also a 127.2% retracement of the April/May decline (chart).

7.21.15dxy_cnh
Topics
technical analysis
u.s. dollar
About the Author: Victor Golovtchenko
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