DXY LONG FROM SUPPORT|
✅DXY has retested a key support level of 107.800
And as the index is already making a bullish rebound
A move up to retest the supply level above at 108.600 is likely
LONG🚀
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USDX trade ideas
Why Tariffs & Why Now?Trump's tariffs aim to reshape international trade. They target imports from China, Mexico, and Canada starting February 1.
The president sees tariffs as both a policy tool and a growing revenue stream. By imposing fees on foreign goods, he hopes to protect U.S. industries and encourage fair trade practices. U.S. manufacturers face an uneven playing field when compared to foreign counterparts like those in Mexico and China, due to differences in regulations and quality controls.
For instance, China doesn’t have strict regulations like OSHA, which ensures worker safety and environmental standards in the U.S. Additionally, Chinese manufacturers often don't face the same level of quality control scrutiny that domestic manufacturing companies do. These disparities make it difficult to directly compare commodities, as U.S. manufacturers shoulder higher costs to comply with regulations, while foreign manufacturers benefit from fewer restrictions. As a result, domestic manufacturers and distributors struggle to compete on price, which is one of the reasons tariffs are viewed as protecting national strategic interest.
Jamie Dimon, CEO of JPMorgan Chase, in a CNBC interview today from Davos, Switzerland, where the World Economic Forum is taking place said, “I would put in perspective: If it’s a little inflationary, but it’s good for national security, so be it. I mean, get over it.”
Citation: www.cnn.com
Tariffs are not new to Trump’s strategy. The trade war with China in 2018 established a framework for using tariffs to gain leverage. This latest round builds on that approach, with broader goals for economic influence. Trump has proposed a 10% tariff on Chinese goods. The reasoning ties to China’s fentanyl production and export practices.
This decision follows conversations with China’s President Xi Jinping. Trump urged stricter measures against fentanyl production and shipping, linking it to broader trade concerns. American businesses already face up to 25% tariffs on many Chinese imports. These new fees would add further strain to supply chains, raising prices for consumers. However, it will promote domestic manufacturing and bulster this important sector of the economy.
Mexico and Canada are also in Trump’s sights. He plans to impose 25% tariffs on goods imported from these neighboring countries. Canadian Prime Minister Justin Trudeau has expressed concerns saying that Canada supplies vital materials like oil, steel, and lumber. He went on to claim that the U.S. Tariffs could disrupt this trade and raise costs for American industries.
Both nations aim to avoid direct trade conflict while protecting their economies from potential damage. Trump’s tariffs serve multiple purposes. They are designed to pressure trade partners, reduce deficits, and address what he views as unfair practices. Tariffs also play a role in domestic revenue generation. They are a tax on imported goods, and higher tariffs mean more money for government programs. Economists warn of potential downsides, including higher consumer prices. Some argue that the inflationary effects could complicate the Federal Reserve’s plans for interest rate cuts. Let's explore that further now.
What does the data say concerning Tariffs?
The ISM Manufacturing PMI (Purchasing Managers' Index) is a key economic indicator that measures the health of the U.S. manufacturing sector. Compiled through surveys of supply chain executives, it tracks new orders, production, employment, supplier deliveries, and inventory levels. A reading above 50 indicates expansion, while a reading below 50 signals contraction. As a barometer of economic activity, the PMI provides valuable insight into broader economic trends and business conditions.
Since the second half of 2022, the ISM Manufacturing PMI has been in contraction territory, reflecting ongoing struggles in the manufacturing sector. Factors such as high interest rates, which increase borrowing costs for businesses, and weaker global demand have weighed heavily on production. Tariffs, while aimed at protecting domestic manufacturing, could potentially exacerbate these challenges by raising input costs, further pressuring profit margins. Critics argue that higher tariffs could contribute to inflation, limiting the Federal Reserve’s ability to lower interest rates and support broader economic growth.
A strong dollar has also added to manufacturers' woes, echoing the environment during Trump's 2017 inauguration. A strong dollar makes U.S. exports more expensive and imports cheaper, reducing competitiveness for domestic manufacturers. In 2017, the dollar weakened after initial strength leading into the Trump inaguration, providing a temporary boost to manufacturing by making exports more affordable and imports pricier. A similar trend today could aid the sector, but its timing and magnitude remain uncertain, leaving manufacturers navigating a complex and challenging economic environment.
A strong dollar is closely tied to domestic interest rates, as higher rates make U.S. financial assets more attractive to global investors. With the Federal Reserve’s benchmark interest rate, or Fed Funds Rate, at elevated levels, there is a strong incentive for multinational corporations and foreign investors to acquire dollars to purchase U.S. Treasuries.
These assets offer a combination of safety and competitive yields, drawing capital inflows that drive up demand for the dollar. For instance, the U.S. 2-year Treasury yield currently sits at 4.295%, significantly higher than China’s 2-year yield of 1.26%. This wide yield differential makes U.S. Treasuries a far more appealing investment, strengthening the dollar in the process.
The Fed’s success in controlling inflation has further bolstered the dollar's appeal. As inflation trends downward toward the 2% target, the relative stability of the U.S. economy enhances confidence in dollar-denominated assets. This dynamic creates a feedback loop: high interest rates attract foreign capital, which strengthens the dollar, making U.S. exports more expensive and imports cheaper. While this helps curb inflation, it poses challenges for domestic manufacturing by eroding competitiveness. This delicate balance underscores the complexity of managing monetary policy while considering its ripple effects on trade and the broader economy.
One bright spot for domestic manufacturing is that it appears to have hit rock bottom after years of sharp declines. Similar to the transportation sector, which shows signs of recovery as reflected in the recent ATA tonnage index, manufacturing seems to be stabilizing. The worst may be over, and the sector is finally showing signs of life. New orders for manufacturing have moved back into growth mode, offering hope for a sustained rebound. This shift signals that demand is returning, which could provide a foundation for manufacturers to rebuild and capitalize on future opportunities.
TRUMP Trade - US Dollar short - ? Hello everyone!
There is a high probability that the dollar rally has come to an end. It appears that the impulse, which could have formed wave ((C)) within a flat correction, has possibly completed.
This flat correction, in turn, may be wave b of a presumed zigzag. If this is the case, there is a high likelihood of the dollar declining to the level of 95.50, with a strong resistance level at 98.80. We are observing a bearish divergence between the price and indicators, which suggests a possible trend reversal or at least a correction.
Fundamentally, there don’t seem to be any clear reasons for the dollar to weaken, but… price comes first.
US Dollar Bearish Trend: Key Insights Analyzed**Is the US Dollar Heading for a Bearish Turn? Key Insights to Watch**
The US dollar has been a hot topic lately, and for good reason. With Donald Trump back in office and the motto being *AMERICA FIRST*, the currency’s trajectory is under scrutiny. As many of you know, the Trump administration has historically favored a weaker US dollar and lower interest rates. The rationale? A weaker dollar can boost exports, while lower rates are seen as a way to stimulate economic growth. This approach was a hallmark of Trump’s first term, and it looks like we might see a repeat.
Another key factor to consider is Trump’s focus on increasing crude oil and natural gas production. Higher energy output could lead to lower energy prices, which would further support economic growth. However, this could also weigh on the dollar, as lower energy prices often correlate with a weaker currency.
Looking back to 2016–2017, when Trump first took office, the US dollar initially surged but then reversed sharply in January 2017, marking the start of a prolonged bearish trend. Fast forward to today, and we’re seeing similar patterns emerge. The wedge formation on the Dollar Index suggests limited upside potential, and a break below key support levels—specifically 108 and 107.58—could confirm that a bearish trend is underway. If those levels fail to hold, the next area to watch would be the 107 to 106 demand zones.
This scenario aligns with what we’ve been discussing over the past few weeks. If the Dollar Index breaks below these critical levels, it could signal the completion of the wedge pattern and the beginning of a new bearish phase for the US dollar.
What does this mean for traders and investors? Keep a close eye on the Dollar Index and watch for those key support levels. A break below them could present significant opportunities, but it’s also a reminder to stay cautious and informed.
What are your thoughts on the US dollar’s trajectory? Do you think history will repeat itself, or are there other factors at play? Let’s discuss in the comments!
#USD #Forex #Trading #Economy #Trump #DollarIndex #Investing #Markets
Monthly CLS, KL Monthly OB, Model 1 , ReversalMonthly CLS, KL Monthly OB, Model 1 , Reversal
you are welcome to comment with your thoughts and share your charts or questions below, I like any constructive discussion.
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DXY in 4H timeframehello dear traders
U.S. Dollar Index (DXY) and the potential for a correction over the next month:
Federal Reserve Monetary Policy:
If the Federal Reserve signals a slowdown or pause in its rate hikes, it could put downward pressure on the DXY. Upcoming speeches or FOMC minutes will be key indicators to watch.
U.S. Economic Data:
Weaker-than-expected economic data, such as lower GDP growth, higher unemployment rates, or declining inflation, could suggest a less aggressive Fed policy, leading to a potential correction in the dollar.
Global Economic Trends and Risk Sentiment:
Increased risk appetite in global markets could drive investors toward riskier assets (like equities or emerging market currencies), reducing demand for the dollar as a safe-haven asset.
Geopolitical and International Developments:
Any easing of geopolitical tensions or positive trade agreements between major economies could diminish the dollar’s safe-haven appeal and contribute to a potential correction.
Correlated Markets like Gold and Oil:
Rising prices in gold or oil often correlate with a weaker dollar. If these assets strengthen, it could be a sign of dollar weakness.
In summary, weaker U.S. data or dovish signals from the Fed, combined with a more favorable global economic environment, could increase the likelihood of a DXY correction over the next month.
DeGRAM | DXY pullback in the channelThe DXY is in an ascending channel between trend lines.
The price is moving from the upper boundary of the channel and dynamic resistance.
The chart has fallen below the support level.
We expect the pullback to continue
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The dollar started correcting the fifth wave towards 0.618. He The dollar started correcting the fifth wave towards 0.618. He feels confident.
The Dollar Falls While Bitcoin & Gold Moves Up Hey there,
So in today's Midweek Market Review, we discuss whats been happening lately in these markets, highlighting the impact of Trumps inauguration, while also explaining the recent run on Gold and the New highs on Bitcoin.
Be sure to check out this weeks market review commentary for more insight and ideas on how to best position yourself for these markets moving forward.
Dollar Index Technical AnalysisThe Dollar Index (DXY) has reached a key weekly resistance zone around 110.26, as shown in the chart. Here's a breakdown of the technical analysis:
Resistance at 110.26:
This level has acted as a critical barrier, causing the current pullback. The index has struggled to sustain momentum above this zone, indicating potential exhaustion for bulls.
Trend Reversal Signals:
The large rejection candles at resistance indicate seller dominance. If the weekly close remains below 109, we could see sustained bearish momentum.
Support Levels Below:
105.35–105.66: Key support zone acting as the next likely target for bears.
103.33–103.82: A significant level to watch if the decline accelerates, providing a potential buy zone.
Shift in COT Data:
The bearish shift in the COT index aligns with the resistance rejection, adding fundamental weight to the technical setup.
Outlook:
With Trump’s policy announcements expected soon, the DXY is at a critical turning point. A break below the immediate support at 108.79 could lead to a drop toward the 105 range. Conversely, if bulls defend this zone, we might see a retest of the 110 resistance.
Trade with caution, as geopolitical and policy events may drive volatility in the coming weeks.
DXY Is Going Up! Buy!
Take a look at our analysis for DXY.
Time Frame: 12h
Current Trend: Bullish
Sentiment: Oversold (based on 7-period RSI)
Forecast: Bullish
The market is trading around a solid horizontal structure 108.100.
The above observations make me that the market will inevitably achieve 109.402 level.
P.S
We determine oversold/overbought condition with RSI indicator.
When it drops below 30 - the market is considered to be oversold.
When it bounces above 70 - the market is considered to be overbought.
Like and subscribe and comment my ideas if you enjoy them!
Dollar Index (DXY) Analysis - January 21, 2025Dollar Index (DXY) Analysis - January 21, 2025
The Dollar Index (DXY) is currently trading at 108.70, up 0.90% from the previous close.
The index is hovering below the key pivot point at 109.40, a crucial level that could dictate the next directional move.
Immediate resistance stands at 110.20. On the downside, support is seen at 107.90, with further cushion at 106.80 and 106.00.
You may find more details in the chart!
Thank you and Good Luck!
❤️PS: Please support with a like or comment if you find this analysis useful for your trading day❤️
DXY - Gap to Fill, "UP then Down"?Dear Friends,
How I see it:
If support holds between 108 & 107, Index will fill the gap first.
Then continue to test support below 108.
I deeply appreciate you taking the time to study my analysis and point of view.
DXY SELL ENTRY MODULEThe DXY is currently testing a key demand level. If a further drop is to unfold, I anticipate a valid retest before it taps into the supply OB and continues its descent. Watch for the price to enter our expected zone, confirm the setup, and then execute your trade.
Always set a stop-loss for your trades to protect your capital and manage risk effectively.
Always use proper money management and proper risk to reward ratio.
#DXY 1H Technical Analyze Expected Move.
DXYThe U.S. Dollar Index (DXY) tracks the value of the U.S. dollar against a group of major global currencies, including the euro, Japanese yen, British pound, Canadian dollar, Swedish krona, and Swiss franc.
Recently, the dollar experienced a slight decline, partly due to the start of the new U.S. presidential administration, which did not immediately introduce new tariffs. This led to reduced concerns over trade restrictions, causing a modest pullback in the dollar’s value.
Despite this short-term dip, the dollar has strengthened over the past year, supported by solid economic performance in the U.S. Financial experts expect the dollar to maintain its strength in the coming months, though potential shifts in trade policies, especially concerning Canada and Mexico, could influence its future direction.
Key dates related to trade policy decisions may bring volatility, and analysts are closely watching upcoming reports that could lead to new tariff implementations, affecting the dollar’s trajectory.
DXY RECOVERS AFTER TRUMP’S INAUGURATIONAs markets adjust to the new U.S. administration, “a dawn of a new era," DXY recovers after Trump’s inauguration. After experiencing a decline of over 1%, the index found support around 107.56 and is now trading at 108.40 as of 3:43 PM GMT+4 (Dubai time), marking a 0.61% increase.
From a fundamental standpoint, President Trump's second administration is anticipated to have a significant impact on the U.S. economy, with a strong emphasis on key economic policies. This includes but not limited to his announcement of a 25% tariff on imports from Canada and Mexico, effective February 1, 2025, alongside maintaining existing tariffs on Chinese goods.
Additionally, his declaration of a "National Energy Emergency" highlights a push to expand oil drilling and deregulate the energy industry. This initiative aims to achieve energy independence and reduce costs but raises concerns about environmental impact and potential legal challenges.
In terms of immigration, stricter enforcement and increased deportations are expected to affect labor markets, particularly in industries heavily dependent on immigrant workers. This could result in labor shortages and higher production costs.
While these policies aim to stimulate economic growth, they come with potential risks, such as inflationary pressures, trade conflicts, and labor market disruptions. The overall impact will depend on how effectively these policies are implemented and their reception both domestically and internationally.
UPCOMING CATALYST
On Thursday, January 23rd, the U.S. unemployment claims are scheduled for release at 5:30 AM GMT+4, followed by the crude oil inventory report at 8:00 PM. The next day, Friday, will feature the release of Manufacturing and Services PMIs at 6:45 PM, and to close the week, existing home sales and consumer sentiment reports will be released simultaneously at 7:00 PM. These data points have the potential to significantly influence market movements, underscoring the importance of cautious analysis and strategic decision-making.
TECHNICAL VIEW:
From a technical perspective, the DXY is recovering from the previous day's losses, which had strengthened major currency pairs such as EUR/USD, AUD/USD, and GBP/USD. Currently, the index is trading around 108.40, with 108.80 acting as a key resistance level. Given the upcoming data releases, a favorable outcome could propel the DXY above 108.80, with potential targets at 109.09, 109.44, and 109.81 in the coming weeks. However, a correction is still a possibility. Conversely, a negative reading could further weaken the dollar, with potential downside targets at 107.48, the psychological level of 107.00, and 106.56. Analysts suggest that breakouts in either direction are possible, depending on the data's impact.
DXYThe U.S. Dollar Index (DXY) is a measure of the U.S. dollar’s value relative to a basket of six major foreign currencies:
• Euro (EUR) – the largest component (~57.6%)
• Japanese Yen (JPY)
• British Pound (GBP)
• Canadian Dollar (CAD)
• Swedish Krona (SEK)
• Swiss Franc (CHF)
DXY rises when the U.S. dollar strengthens against these currencies and falls when it weakens. It is widely used by traders, investors, and policymakers to assess the dollar’s strength in global markets.
DeGRAM | DXY seeks to close the gapDXY is in a descending channel between trend lines.
After the gap formation, the price has reached the lower boundary of the channel, the support level and the lower trend line, which previously acted as a rebound point.
The chart approached the 38.2% retracement level and is now holding above the resistance level.
We expect the rebound to continue if successfully consolidated above the resistance level.
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The dollar is very weak, it broke 108.575, now it is considered The dollar is very weak, it broke 108.575, now it is considered neutral
Weakening USD $DXY after the Trump Inauguration? In the last Trump administration, the USD TVC:DXY declined in 2017 post-inauguration
I believe history could repeat itself, potentially boosting risk assets in 2025 like crypto and AMEX:IWM
Between the 2024 election and the 2025 inauguration, the USD strengthened, mirroring the 2016/2017 period, supporting this thesis
DXY- Start of correction?In my previous analysis of the DXY, I mentioned that the index might begin a correction after more than three months of upward movement and a 10% increase.
Yesterday, the market opened with a downside gap and broke below the rising trendline that had been supporting the price since the 100 mark. This suggests that 110 could now serve as a local top. As long as the price remains below this level, shorting the USD currency could present a viable trading opportunity.
I am currently looking for buying opportunities in currency pairs such as EUR/USD, GBP/USD, AUD/USD, and NZD/USD.
Levels discussed on 20th Jan 2025 Livestream20th January 2025
DXY: Currently below 109.40, break above, could trade up to 110 (previous swing high), beyond that, strong resistance at 111
NZDUSD: Sell 0.5575 SL 25 TP 60
AUDUSD: Sell 0.6170 SL 15 TP 40
GBPUSD: Sell 1.2150 SL 15 TP 40
EURUSD: Sell 1.0310 SL 30 TP 110
USDJPY: Buy 156.70 SL 40 TP 120
EURJPY: Sell 161.10 SL 40 TP 120
GBPJPY: Looking for reaction at 191.15
USDCHF: Choppy between 0.91 and 0.9150
USDCAD: Buy 1.4480 SL 30 TP 60
XAUUSD: Needs to stay above 2694 (trendline) to trade up to 2722 resistance
The DXY experiences declines as it reacts to monthly supply zoneThe DXY experiences declines as it reacts to monthly supply zones, while the gold market remains steady amid this shift. Market participants should watch for further corrections in the DXY and potential demand shifts in gold. follow for more inisights, comment and boost idea
