United States Dollar Index (DXY) Price Forecast: Bulls await move beyond 99.50 key hurdle
- USD Index retreats slightly from a nearly two-month high, touched earlier this Thursday.
- The Israel-Lebanon truce prompts some profit-taking, though the downside seems limited.
- Iran risks and Fed hike bets warrant caution for bears amid a constructive technical setup.
The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, struggles to find acceptance above the 99.50 supply zone and retreats slightly from a nearly two-month high, touched earlier this Thursday. The index sticks to modest intraday losses through the early European session, though the downside potential seems limited amid geopolitical uncertainties as traders await the release of the US Nonfarm Payrolls (NFP) report on Friday.
The Israel-Lebanon truce dents demand for the safe-haven US Dollar (USD) and prompts some profit-taking. Meanwhile, the US and Iran remain at odds over key issues, including Tehran's nuclear program and the Strait of Hormuz. Furthermore, renewed hostilities in the Middle East keep geopolitical risks in play amid the lack of a breakthrough in US-Iran diplomatic negotiations. Adding to this, elevated oil prices continue to fuel inflation fears and bolster bets for a rate hike by the US Federal Reserve (Fed). This, in turn, helps limit the downside for the DXY and warrants caution for bearish traders.
The index, so far, has been struggling to make it through the 61.8% Fibonacci retracement level of the March-May downfall. The near-term bias, however, remains bullish as the USD holds above the 200-period Simple Moving Average (SMA) on the 4-hour chart and the key 50% Fibo. level. Moreover, the Relative Strength Index (RSI) around 61 and a mildly positive Moving Average Convergence Divergence (MACD) reading suggest constructive momentum.
That said, the immediate upside remains constrained by the 61.8% Fibo. hurdle at 99.50. A sustained strength beyond should pave the way for additional gains towards the 78.6% level at 100.00 and the recent swing high at 100.65. On the downside, first support is seen at the 50% retracement near 99.14, followed by a cluster formed by the 38.2% level at 98.78 and the 200-period SMA at 98.72. A deeper pullback would expose the 23.6% retracement at 98.35 and the structural floor around 97.63.
(The technical analysis of this story was written with the help of an AI tool.)
DXY 4-hour chart
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.39% | 0.24% | 0.32% | 0.83% | 0.50% | 1.74% | 1.30% | |
| EUR | -0.39% | -0.15% | -0.07% | 0.43% | 0.11% | 1.37% | 0.91% | |
| GBP | -0.24% | 0.15% | 0.13% | 0.59% | 0.26% | 1.53% | 1.05% | |
| JPY | -0.32% | 0.07% | -0.13% | 0.52% | 0.22% | 1.43% | 0.96% | |
| CAD | -0.83% | -0.43% | -0.59% | -0.52% | -0.33% | 0.91% | 0.46% | |
| AUD | -0.50% | -0.11% | -0.26% | -0.22% | 0.33% | 1.26% | 0.80% | |
| NZD | -1.74% | -1.37% | -1.53% | -1.43% | -0.91% | -1.26% | -0.47% | |
| CHF | -1.30% | -0.91% | -1.05% | -0.96% | -0.46% | -0.80% | 0.47% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
