Dollar Index – Weekly Analysis
The Dollar Index is approaching a decisive moment—but the signal isn’t where most are looking.
In this week’s analysis, we uncover the subtle shifts in momentum, the hidden pressure building across key timeframes, and why the next move in the dollar could ripple across every major market.
CANDLES
The U.S. Dollar Index made several decisive moves this week. While the 8/20 EMA bearish cross may pressure the index in the short term, the 50/100 and 50/200 DMA bullish crosses are likely to outweigh it, supporting the dollar over the mid- to long-term horizon.
From a candlestick perspective, the moves on Thursday and Friday represent two failed attempts to extend bearish momentum. As a result, the weekly chart also failed to form a top. Bulls are clearly present, and their pressure may become more noticeable next week.
Overall, the index remains neutral on the short- and mid-term frames as these mixed signals resolve, while the long-term outlook continues to favor the upside.
MACD – Weekly
I continue to view the weekly MACD as a meaningful leading indicator for the U.S. Dollar, and the current technical footprint closely resembles the 2020–2021 bottoming process. The ongoing move can be interpreted as a backtest of the 50 WMA support.
As a reminder, DXY rallied 28.5% in 2021–2022, reaching nearly $115. At this stage, the index appears to be in the early phases of a potential new rally.
ELLIOTT WAVES
At this stage, there is no substantial evidence to justify a change in the very long-term outlook. In March, the index possibly formed a long-term bottom.
Road Map
The mid-term roadmap remains unchanged.
Last Wave
The U.S. Dollar Index has likely completed a clean higher-degree impulse, marked as wave (i). The recent move down can be interpreted either as the full wave (ii) in red or as wave a within a larger wave (ii) in purple.
In both scenarios, a renewed move higher—comparable in size to wave (i) or potentially larger—remains a high-probability outcome. The exact path, however, is yet to be determined.
SUMMARY
The U.S. Dollar Index remains in a transitional phase, with short-term signals leaning mixed while the broader structure continues to favor the upside. Recent price action shows that bearish pressure has struggled to gain traction, keeping the index supported despite temporary weakness.
From a higher-level perspective, the technical setup points to a developing bullish cycle. The current move appears to be part of a corrective phase within a larger advance, suggesting that once this consolidation resolves, the path toward a renewed rally remains the more probable outcome.
