US Dollar, Sterling, Bitcoin Weekly Technical Outlook

US Dollar Index Price Chart – USD 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; DXY on TradingView

Notes: The U.S. Dollar Index is testing a key pivot zone at the August 20204 high and the 2024 low close at 100.26/35. The breakout of the September opening range last week keeps the focus on a late-month high, but the rally does need to clear this key zone on a close basis to keep the immediate advance viable in the days ahead.

Initial support rests with the channel line off the monthly low and is backed by 99.80/86- a region defined by the 38.2% retracement of the June decline and the September opening range high. Broader bullish invalidation is now raised to the 38.2% retracement of the yearly range and the January high at 99.41/49.

Initial resistance is eyed at the 61.8% retracement / September high at 100.56. A breach / daily close above this threshold is needed to mark resumption of the monthly uptrend with subsequent resistance objectives eyed at 101.11 and the yearly high-day close at 101.59.

Bottom line: The Dollar rally has extended nearly 2% off the monthly low with the index testing a pivotal resistance near 8-week highs. From a trading standpoint, losses would need to be limited to 99.80 IF price is heading higher on this stretch with a close above 100.56 needed to fuel the next leg higher in the index.