U.S dollar index Long Term Technical Analysis July 2020

U.S dollar index long-term technical analysis

Free $100 Forex No-Deposit Bonus

Uncertainties mounting on the world economic situation as coronavirus continue to spread worldwide. U.S federal reserve’s Jerome Powell expressed concern about the situation and become extraordinarily uncertain about the future of the largest economy in the world. The future of the economy largely will depend on the ability to contain the coronavirus.

It means traders and investors might stick to the risk-averse assets/currencies. Meanwhile, the U.S dollar might come under pressure last month as the economic reopening prove successful. However, there was increase in new coronavirus cases nearing the end of the month.

U.S dollar index might return to strength once again judging from the new case development. This 1-2 months will become vital for the world to determine if there is second wave of coronavirus or not.

New Month

Monthly chart

We have an official close outside of the bullish channel. U.S dollar index will attempt to continue the bearish trend from the current level. Will the attempt result in a successful bearish trend? Alternatively, will the index make the sudden jump and close inside the channel as happened in February?

At the current time, traders who have a short U.S dollar position could continue to hold it with a stop above the previous month’s high.

Weekly chart

On the weekly chart, we could see the bear has more advantages compared to the bull. The index pressured lower and continue to stick near the weekly SMA 200. If the bear could maintain the pressure then we might see the U.S dollar index breakout lower with strong explosive movement.

Daily chart

The situation looks bearish below the daily SMA 200. U.S dollar index currently testing the 97.50 level and no breakout is seen yet. The index makes a bearish movement below the previous day low (Bearish pin bar) and might continue lower to target 96.70.

Trade plan (For U.S dollar pair)

On the long-term chart, it seems the U.S dollar index trend has turned bearish. However, it is still possible for the index to make a comeback similar to in February this year. The weekly SMA 200 or the level around 96.10 might become the key level to watch.

As long as the level maintained, there is a chance for the index to bounce and start moving higher.

Copyright © 2020. All Rights Reserved. FXDailyReport.Com
Risk Warning: Trading CFDs is a high risk activity and you may lose more than your initial deposit. You should never invest money that you cannot afford to lose. FXDailyReport.com will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets.