The US Dollar Index hit a low of 89 on 6th January 2021. Since then it has generated a bullish double bottom pattern reaching the 89.5 level again on 25th May 2021.
The DXY then initiated a long-term uptrend, taking it to level 109 on July 14, 2022. The upward move lasted 553 days and led to a 22.5% increase. Additionally, it appears to have run along a parabolic uptrend line, which has been validated multiple times.
Initially, it looked like the parabola was broken in May 2022, when the US Dollar Index hit a critical resistance level in the 103-104 range. However, after a small correction, the DXY rose, reaching another resistance area in the 108-109 range.
The peak was reached with the formation of an inverted hammer candle (red arrow), which often signals a downtrend reversal. The following weeks saw declines and currently, the US Dollar Index sits at 105. The breakout of the exponential uptrend line occurred in early August. If the declines cannot be stopped and a higher-order parabola does not form, it is possible that the DXY has already reached a long-term peak.
The DXY then initiated a long-term uptrend, taking it to level 109 on July 14, 2022. The upward move lasted 553 days and led to a 22.5% increase. Additionally, it appears to have run along a parabolic uptrend line, which has been validated multiple times.
Initially, it looked like the parabola was broken in May 2022, when the US Dollar Index hit a critical resistance level in the 103-104 range. However, after a small correction, the DXY rose, reaching another resistance area in the 108-109 range.
The peak was reached with the formation of an inverted hammer candle (red arrow), which often signals a downtrend reversal. The following weeks saw declines and currently, the US Dollar Index sits at 105. The breakout of the exponential uptrend line occurred in early August. If the declines cannot be stopped and a higher-order parabola does not form, it is possible that the DXY has already reached a long-term peak.