US Dollar Outlook: USD loses momentum as technical levels hold firm

As fundamentals continue their weighting on risk appetite, the safe haven US Dollar has lost momentum in comparison to major currency pairs.

US Dollar Outlook: USD loses momentum as technical levels hold firm

The US Dollar Currency Index (DXY), which broke above the psychological 90.00 mark in June, has shown a strong upward trend.

The red candle in the month chart below may indicate that further downside is possible if bulls are unable to reclaim the prominent, systemic trend.

Prices are now below the 50% level of the 2001-2008 move at 95.843, which will continue to be a strong resistance in the medium and short-term.


EUR/ US price action is currently at the 200-day moving average. This coincides with the 50% retracement in the 2018-2020 move.

Prices hovering below 1.160 per week, this may be due to rising inflation and the soaring prices of commodities. This could provide an additional boost for the major pair in the coming weeks.

Bears must now push below the 200 SMA at 1.157 to maintain their bearish momentum.

USD/JPY Technical Analysis

Since breaking out of the narrow range that previously held the pair, USD/ JPY have been steadily increasing. The weekly chart below shows that the Fibonacci levels from 2015-2016 have continued to provide support and resistance levels for price movement and will likely continue to do this for any future move.

The safe-haven currencies are still fighting it out above the psychological level of 114.00. Bulls are now pushing the weekly relative strength indicator (RSI) into overbought territory, (above 70 handle).