In the latest weekly overview I wrote EURUSD is a hot mess. Price action this week confirms the ‘hot mess’ theme. EURUSD contributes the biggest weight in the US dollar index and thus we could say DXY is a hot mess as well.
DXY is trading at an important technical level right now and now is the time for bulls to show if they have any power left to move the price higher!
We can see that DXY is trading just above four supports: the green trendline which started in 2014, the upper ’15/’16 channel line, the lower line of a corrective wedge and just around 99 level which was the breakout point at the end of last year’s bull run.
Should we break the support to the downside, bears might win this battle and DXY could trade lower. On the other hand if supports hold, dollar bulls have an excellend risk reward entry point.