Technical Overview: The U.S. Dollar Index is displaying multiple bearish patterns and indicators across the chart, suggesting the potential for a short-term downtrend:
Support and Resistance Levels: Key Resistance: The index is currently near a resistance zone, with sellers likely to dominate below this level.
Ichimoku Cloud Analysis: The price is trading below the Ichimoku cloud at 4-Hours, indicating bearish momentum.
Broadening Pattern: A broadening pattern has been identified, reflecting increased volatility and expanding price ranges. The index appears to be trending toward the lower boundary of this pattern.
Head and Shoulders (Incomplete): The head is clearly formed, with both shoulders developing symmetrically. A break below the neckline will serve as the trigger for further downside.
Target Levels: Based on the confluence of these technical patterns and indicators, the DXY could reach the following support levels:
TP1 : 105.388 TP2 : 105.731 TP3 : 104.700
Conclusion: The combination of support and resistance analysis, Ichimoku cloud signals, and bearish chart patterns (Broadening and Head and Shoulders) strengthens the case for a short position on the U.S. Dollar Index.
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