Dollar index (DXY) Analysis DXY Analysis – General Outlook
This week’s analysis is more of a general overview, and it closely aligns with my view on EUR/USD. While I don’t trade DXY directly, I use it heavily as a confluence tool, so marking out its likely direction is key for aligning trades across other USD-related pairs.
At the moment, I’m favouring Scenario A, where I expect DXY to move a bit lower, accumulate, and then react from the 2-day demand zone. If that happens, we could see a bullish move on DXY, which would naturally result in bearish pressure for other pairs like EU and GU.
However, if price decides to retrace upwards first, there’s a clean supply zone that still needs to be mitigated. If that zone holds, DXY could continue its bearish structure for longer—meaning more bullish momentum across other major pairs.
DXY trade ideas
Smart Traders Watch the Fed — Smarter Ones Watch the DollarHello Traders 🐺
In this idea, I decided to talk about the U.S. Dollar Index (DXY) — because so many people have been asking me:
“How do you predict the Fed’s moves, and how do they affect deflationary assets like BTC?”
My last idea was about BTC, where I explained why I believe a major bull run is coming — and part of that is because the Fed might soon shift back to QE.
But if you're trying to predict QE...
The first thing you need to watch is the U.S. Dollar Index, which reflects the strength of the U.S. Dollar.
So let’s break it all down:
🔍 Part 1: What Does the Fed Actually Do?
The Fed isn’t just a printer — it’s the U.S. central bank, and it has a dual mandate:
✅ Keep prices stable (control inflation)
✅ Promote maximum employment
That means the Fed doesn’t just want growth — it wants sustainable growth. No crazy inflation, no deep recession. Balance is key.
🧰 How Does the Fed Do It?
Through Monetary Policy, which is basically the toolkit used to control liquidity, interest rates, and economic behavior (like how much people borrow, spend, or save).
Let’s break down the main tools:
1️⃣ Federal Funds Rate
This is the most powerful tool the Fed has.
It’s the rate banks use to lend to each other overnight.
If the Fed raises the rate:
→ Loans get expensive
→ Spending slows
→ Inflation drops
→ But markets can crash
If the Fed cuts the rate:
→ Loans get cheaper
→ Demand rises
→ Growth accelerates
→ But inflation can surge
2️⃣ Open Market Operations (OMO)
This is how the Fed injects or removes liquidity using bonds.
Buys bonds → Injects money → 🟩 QE (Quantitative Easing)
Sells bonds / lets them expire → Removes money → 🟥 QT (Quantitative Tightening)
3️⃣ Reserve Requirements
This used to be a big deal — the % banks had to hold in reserves.
But since 2020, it's set to 0%.
4️⃣ Discount Rate
The interest rate the Fed charges banks directly.
A change here sends a strong signal to the markets.
Sometimes the Fed also works in sync with the U.S. government — using fiscal support like:
💸 Stimulus checks
🏢 Corporate bailouts
🧾 Tax relief packages
📈 So... Why Does the Dollar Index (DXY) Matter?
There’s a very clear inverse correlation between the DXY and BTC.
When the dollar gets stronger (DXY pumps), BTC usually dumps.
Why? Because rising DXY often means:
🔺 The Fed is raising rates
🔺 Liquidity is being pulled out
🔺 QT is in play
Let me show you some real chart examples:
📉 July 2014 — DXY pumped → BTC dumped hard
DXY Chart:
BTC Chart:
➡️ Just a 28% DXY pump → 80% BTC crash. Ouch.
📈 2017 — DXY dropped → BTC entered full bull market
DXY Chart:
BTC Chart:
➡️ A 15% DXY drop → Bitcoin bull run of a lifetime.
Now here’s the good news 👇
DXY is starting to look very bearish on the chart:
Combine that with the Fed shifting to QE, and guess what?
We're likely entering the early stages of another bull market.
If you read my last BTC idea, you already know what I’m expecting...
🚀 A massive run is just around the corner.
I hope you found this idea useful, and as always —
🐺 Discipline is rarely enjoyable, but almost always profitable 🐺
🐺 KIU_COIN 🐺
DXY Weekly Analysis – Critical Support Zone at 98.4
The US Dollar Index (DXY) is currently testing a major support zone around 98.4 on the weekly timeframe. This level aligns with the bottom of a long-term ascending channel, and it also coincides with a horizontal support zone that has held multiple times in the past.
If this area holds, we could see a strong bullish rebound towards the 105 area — or even higher. However, a clear break below this support may open the door for a deeper decline toward the 89–90 range, which marks the next significant support zone.
Overall, DXY is sitting at a crucial decision point, and the market’s reaction in the coming weeks will be key for medium to long-term direction.
Dollar under pressure, is the bear trend gonna end soon?President Trump's aggressive tariff implementations, particularly on electronics and critical imports, have introduced volatility into U.S. markets. These measures have led to decreased investor confidence and capital outflows from U.S. assets, contributing to the dollar's weakness.
There's growing concern among global investors about the reliability of U.S. economic policies. A Bank of America survey indicated record pessimism towards U.S. assets, with over 60% of fund managers anticipating further depreciation of the dollar.
The Trump administration's economic approach, informally dubbed the "Mar-a-Lago Accord," aims to deliberately weaken the dollar to boost U.S. exports and reduce trade deficits. While this strategy seeks to make American goods more competitive, it risks destabilizing global financial markets and undermining the dollar's reserve currency status.
Differences in monetary policies between the U.S. and other major economies have widened. While the Federal Reserve has been cautious with rate cuts, other central banks, like the European Central Bank, have been more aggressive, making their currencies more attractive to investors.
In all these Chaos can dollar bounce back?
The U.S. Dollar Index (DXY) is trading around 99.23—down about 1.5% over the past week and roughly 4% lower so far in April, its worst monthly performance since mid‑2022
That 99.0–99.5 zone lines up with both the April swing lows and the lower Bollinger Band on the daily chart—classic territory where “oversold” signals often lead to a rebound.
The 14‑day RSI is hovering near 30, the canonical “oversold” threshold where prior rallies have begun
Markets now price in three rate cuts by year‑end, a sharp turn from December’s hawkish Fed rhetoric. If the Fed leans dovish in the May minutes, yield differentials could narrow—supporting a dollar bounce
Heightened trade‑war uncertainty (tariffs on critical minerals, spiking gold) often drives investors back into dollars as a haven—another buffer at current lows.
Technically the chart is still bullish on daily and certainly near the support zone, both scenario are in play for now, if it continues to drop sharply towards 96 then it may totally reverse back to 107.
Considering Dollar bottom is near we can plan a swing trade with a huge potential, with awesome risk and reward.
Good luck trade safe.
DXY Is Bullish! Buy!
Please, check our technical outlook for DXY.
Time Frame: 15m
Current Trend: Bullish
Sentiment: Oversold (based on 7-period RSI)
Forecast: Bullish
The price is testing a key support 99.109.
Current market trend & oversold RSI makes me think that buyers will push the price. I will anticipate a bullish movement at least to 99.404 level.
P.S
Overbought describes a period of time where there has been a significant and consistent upward move in price over a period of time without much pullback.
Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
Like and subscribe and comment my ideas if you enjoy them!
DOLLAR INDEXThe Federal Reserve's monetary policy stance in April 2025 is characterized by a cautious, data-dependent approach amid mixed economic signals and heightened uncertainty, particularly due to the impact of tariffs and trade tensions.
Key Points on the Fed’s Monetary Policy This Month
Interest Rates: The Fed has maintained the federal funds target range at 4.25% to 4.50%, holding steady without changes in April. The Committee is carefully assessing incoming data before considering any adjustments to rates.
Balance Sheet Reduction: Starting in April, the Fed slowed the pace of its balance sheet runoff by reducing the monthly cap on Treasury securities redemptions from $25 billion to $5 billion, while maintaining the cap on agency debt and mortgage-backed securities at $35 billion. This move smooths the transition from abundant reserves but does not signal a change in the overall policy stance.
Economic Outlook and Risks:
The economy continues to expand modestly with a solid labor market, but inflation remains somewhat elevated above the 2% target.
The Fed acknowledges increased uncertainty due to tariffs, which may simultaneously slow growth and push inflation higher, creating a challenging policy environment. Chair Jerome Powell highlighted the potential conflict between the Fed’s dual mandate of maximum employment and price stability in this context.
The Fed is prepared to adjust policy as appropriate, depending on how economic data evolve, but currently prefers to "stand pat" and await clearer signals on the economy’s response to tariffs and other factors.
Inflation and Employment: Inflation is gradually declining but remains above target. The labor market is solid but expected to soften somewhat due to slower growth and tariff effects, with unemployment forecasted to rise modestly over the next year.
Forward Guidance: The Fed’s communication emphasizes patience and data dependency, with the next FOMC meeting scheduled for May 6-7, where further policy decisions will be evaluated based on new economic information.
Summary
Aspect Current Fed Stance (April 2025)
Federal Funds Rate Held steady at 4.25%–4.50%
Balance Sheet Reduction Slowed Treasury runoff to $5B/month
Inflation Elevated but gradually declining
Labor Market Solid but expected to soften
Tariff Impact Significant uncertainty; potential stagflation risk
Policy Outlook Patient, data-dependent; no immediate rate changes
Next FOMC Meeting May 6-7, 2025
In essence, the Fed is maintaining a modestly restrictive monetary policy stance this month, balancing between controlling inflation and supporting employment amid trade-related uncertainties. It is closely monitoring economic data before making further moves, signaling readiness to adjust policy if risks to growth or inflation intensify.
Dollar has next 4 years (Be greedy when others are fearful)The world is changing fast, and the next four years may be strong for the U.S. dollar . This is not random— it's part of a cycle . Greed-fear cycle
Right now, humanity is entering a time where AI will take over most service-based jobs . Lawyers, designers, consultants—even coders—are slowly being replaced by machines. The entire service economy is becoming automated.
When that happens, only countries with real manufacturing will survive.
That’s why what President Trump said earlier about “bringing back manufacturing” makes full sense now.
When services become automated, tangible assets rise.
And the dollar may lead this shift.
DXY: Strong Bullish Sentiment! Long!
My dear friends,
Today we will analyse GOLD together☺️
The price is near a wide key level
and the pair is approaching a significant decision level of 98.127 Therefore, a strong bullish reaction here could determine the next move up.We will watch for a confirmation candle, and then target the next key level of 98.393.Recommend Stop-loss is beyond the current level.
❤️Sending you lots of Love and Hugs❤️
DXY Trading Opportunity: Bullish Setup & Precise SignalsOn Thursday, the DXY declined, trading below 99.50 with a drop of over 0.50%, mainly influenced by the latest remarks of U.S. President Donald Trump and Treasury Secretary Mnuchin regarding global tariff negotiations. Meanwhile, the U.S. durable goods orders data showed a divided picture, reigniting market expectations for a Federal Reserve interest rate cut.
On the hourly chart, the DXY exhibits obvious technical pressure characteristics. The price has gradually retreated from the previous high near the 100 level and is currently consolidating around 99.30. In the MACD indicator, the DIFF line and the DEA line are in a deadlock above the zero axis, indicating a weakening of short-term momentum. The RSI indicator stands at 43.2687, in the neutral zone; 99.1000 has become an important support level in the near term.
From a daily chart perspective, the DXY shows an obvious downward trend. Since February 2025, the price has formed a series of lower highs and lower lows, and has recently broken below the psychological threshold of 100.00. The MACD indicator shows that the bearish momentum is dominant, with DIFF at -1.3961 and DEA at -1.3223 both operating below the zero axis. The RSI indicator is at 35.1769, on the verge of the oversold area, suggesting a possible technical rebound. 97.9229 is the recent low and constitutes an important support level. If this level is broken, the DXY may accelerate its downward movement.
DXY
buy@99.100 - 99.200
tp:99.800 - 100.300
Investment itself is not risky; it is only when investment is out of control that risks occur. When trading, always remember not to act on impulse. I will share trading signals every day. All the signals have been accurate without any mistakes for a whole month. No matter what gains or losses you've had in the past, with my help, you have the hope of achieving a breakthrough in your investment.
DXY BEARISH BIAS|SHORT|
✅DXY is trading in a downtrend
And the index is making a local
Bullish correction so after the
Resistance is hit around 100.500
We will be expecting a local
Bearish correction
SHORT🔥
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Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
DXY Long to 100 off bullish news from Trump
1. Current Data and research
Macro Regime
Business cycle
- moving into recession territory. S&P is down from 6125 to 4842 at its lowest. That's a 21% drop - this crosses the 20% drop threshold.
Inflation
- Headline 2.4%. Slightly above 2% target. Core PCE is at 0.4%. This is higher than expected.
Monetary Policy
- Still at high interest rate levels of 4.5%. There's more room for cuts than hike in general. However, Tariffs is a spanner in this logic as it introduces inflation that needs to be controlled, and limits the cuts.
Growth
- Consumer sentiments - 50.8. This is a drop from 57. Not a good sign for confidence in the US markets
Central Bank Outlook
- Forward Guidance & Policy Path - "Wait and see" approach to see the full effects of the tariffs and will tackle. Unlikely to cut rates quickly due to inflation risks from tariffs.
Flow & Positioning Factors
- LDN and NY opens
List of upcoming data
German PMI - today
US PMI - today
Expectations
German PMI - 47.5/50.3 - Unsure, but doubt there will be a huge surprise to the upside
US PMI - 49.3/52.9 - Expect a downtrend here and close to the 49.3. It will invalidate longer-term trades if there's a huge surprise to the downside
US Unemployment claims -NA -Expecting higher
Bullish arguments
- More pumping by Trump to prop the market up while the fundamentals are still likely to bad as tariffs are still there
Bear arguments
- The tariff is still the biggest elephant in the room and nothing has changed there. If anything, China has taken steps to prepare for a worse response in the future if US does not reach a negotiation.
2. Trade Thesis
Directional Thesis
I am expecting DXY to go back up to 100 due to a temporary strength in the USD from the good news for Fed Powell and Trump backing down in tariffs.
Supporting Logic
- Structural
-- The DXY was holding 100 level before the Powell news.
-- If the current news stays status quo, I expect prices to rise back up to that fundamental level after a brief pullback from 99.4 to 99.2
-Tactical
A significant lower-high pivot point set on H1 chart. I need prices to remain above that 99 level. If it drops below, then the tactical levels do not work.
- Flows
Look for entry at either LDN or NY session open
Expected Path
- Pull back to 99.0 and now slow ascend back to 100
- There's a resistance level at 99.6. That would be TP1, and 100 would be TP2
Invalidation Logic
- Fundamental Invalidation
-- Trump tweets another fire Fed
-- China escalates the trade war
-- US PMI has a huge downside surprise (unlikely)
- Price-Based Invalidation
-- Price breaking below 99
Asymmetric Setup
If I enter at 99.1X, this is a potential 1:4R trade with high confidence
Trade Setup
Entry level
- 99.1 to 99.2
Scale-in plan (if any)
- I can enter full size here
Position sizing
- 1% of account
TP zones
- TP1 - 99.6
- TP2 - 100
- TP3 - 101 (significant psychological level)
Time stop
Kill trade if
a) Prices drop below 99
b) Prices do not bounce to the upside within 2 hours of LDN and NY open
DXY: Local Bullish Bias! Long!
My dear friends,
Today we will analyse DXY together☺️
The recent price action suggests a shift in mid-term momentum. A break above the current local range around 99.390 will confirm the new direction upwards with the target being the next key level of 99.627 and a reconvened placement of a stop-loss beyond the range.
❤️Sending you lots of Love and Hugs❤️
DXY Is Bullish! Buy!
Take a look at our analysis for DXY.
Time Frame: 9h
Current Trend: Bullish
Sentiment: Oversold (based on 7-period RSI)
Forecast: Bullish
The market is on a crucial zone of demand 99.408.
The oversold market condition in a combination with key structure gives us a relatively strong bullish signal with goal 101.388 level.
P.S
Please, note that an oversold/overbought condition can last for a long time, and therefore being oversold/overbought doesn't mean a price rally will come soon, or at all.
Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
Like and subscribe and comment my ideas if you enjoy them!
Bearish sentiment on the USD index (DXY)TVC:DXY
On this trading week (April 14-18), we have not seen much volatility in the USD index, with its highest trading point at approximately 100.3 and lowest 99.2, partly due to a long bank holiday for Good Friday and Easter on the following Monday. On last week's Friday, price briefly tapped into the weekly demand zone and gave a quick reaction upwards to the 4-hour supply zone, which then quickly rejected and cooled price back down. Currently, price is still sitting at the lower point of the weekly range, we can expect DXY to have a very short-term push back to this strong 4-hour swap zone above, possibly creating a higher high, before pushing it back down. Price is very likely to take out the weekly lows and continue to push towards the bottom of the weekly demand zone.
On fundamentals, Bank of America's analysts had identified close relationship of its depreciating USD, with its falling US asset and equities values. Economic activities have also declined due to trade wars and huge uncertainty of the upcoming policy changes by the Trump administration; asset managers and central banks may also continue to sell USD. Besides, the US is very likely to continue reducing its interest rates in order to boost its economic activity. One of the reasons why Trump imposed high tariffs into many countries was to reduce international dependency on the manufacturing sector and trade deficits, and to attract foreign investments to set up factories in the US, in order to sell to consumers at the 'good price'. However, it is still very controversial on how effective it is, business owners abroad may perceive Trump's policies as bipolar, which changes depending on his mood, therefore, majority of businesses would rather partner elsewhere than to put themselves through this hassle. USD has also dropped 10% since the start of 2025 and has reached its lowest in three years.
References:
www.investing.com
www.cbsnews.com
DOLLARThe U.S. Dollar Index (DXY) has fallen below the 100 mark in April 2025 due to a combination of trade tensions, shifting investor sentiment, and concerns over the U.S. economic outlook and Federal Reserve policy. Key reasons include:
1. Trade War and Tariff Impact
President Donald Trump's imposition of aggressive tariffs (e.g., 145% on Chinese imports) and China’s retaliatory tariffs have sparked fears of a full-blown global trade war. This has unsettled financial markets, leading investors to reduce exposure to U.S. assets and the dollar.
The tariffs have disrupted trade flows, increased inflationary pressures, and raised concerns about slower economic growth in the U.S., which undermines the dollar’s appeal.
2. Declining Safe-Haven Demand
Traditionally, the dollar benefits as a safe-haven currency during global uncertainty. However, in 2025, investors are increasingly turning to gold, which hit record highs above $3,300and headed to 3400 as an alternative safe haven. This shift reflects doubts about the dollar’s reliability amid trade tensions and fiscal imbalances.
3. Concerns Over U.S. Economic Growth and Recession Risks
Rising fears of a U.S. recession, fueled by tariff-induced economic headwinds and slowing corporate earnings, have dampened confidence in the dollar.
The Federal Reserve’s cautious stance and signals of potential rate cuts later in 2025 have also contributed to weakening the dollar, as lower interest rates reduce the currency's yield advantage.
4. Political and Policy Uncertainty
Market unease has been heightened by President Trump’s public threats to remove Fed Chair Jerome Powell, raising concerns about the Fed’s independence and future monetary policy direction.
Political noise and uncertainty over trade negotiations, especially with China, have further pressured the dollar.
5. Technical and Market Sentiment Factors
Technically, the DXY has broken below key support levels, including the 200-day simple moving average (~104.6) and the psychologically important 100 level, signaling bearish momentum.
Summary Table of Factors Driving DXY Below 100
Factor Impact on DXY
Trade War Tariffs = Reduced dollar demand, increased volatility
Shift to Gold as Safe Haven= Dollar loses safe-haven status
U.S. Economic Slowdown Fears= Weaker growth outlook dampens dollar strength
Fed Policy Uncertainty = Rate cut expectations reduce dollar yield
Political Risks = Fed independence concerns add to uncertainty
Technical Breakdown = Breach of key supports fuels bearish momentum
Conclusion
The DXY’s fall below 100 reflects a complex mix of trade-related economic risks, diminished safe-haven demand, political uncertainty, and expectations of a more dovish Federal Reserve. Unless these issues ease—such as through trade deal progress, clearer Fed guidance, or economic stabilization—the dollar is likely to remain under pressure in the near term.