The US Dollar Index (DXY), which measures the Greenback against a basket of major currencies, regained positive momentum at the start of the week, climbing back above the 101.00 mark during the first half of the European session. This move comes after the DXY snapped a two-day losing streak and appears to be driven in part by geopolitical uncertainties related to tensions over the Strait of Hormuz [1].
Technical analysis indicates that the DXY found support near the 50% Fibonacci retracement level of the upswing from mid-June on Friday, and the subsequent move above the 38.2% Fibonacci level suggests the recent corrective pullback from the highest level since May 2025, reached on June 24, may have ended. Momentum indicators such as the Relative Strength Index (RSI) hovering just above 50 and a positive-turning MACD point to a gradual recovery phase rather than a strong bullish trend. Initial resistance is seen at the 23.6% Fibonacci level near 101.24, with a further barrier at 101.80. A break below 100.90 could expose the index to deeper retracement levels at 100.61 and 100.33, while a move below the 100-day SMA near 100.79 would undermine the current constructive outlook [1].
In terms of currency performance, the US Dollar was the strongest against the Japanese Yen, gaining 0.54% on the day. It also posted gains against the Euro (0.13%), British Pound (0.11%), Canadian Dollar (0.21%), Australian Dollar (0.10%), New Zealand Dollar (0.49%), and Swiss Franc (0.24%) [1].
No explicit forward-looking statements or analyst opinions were provided in the source article, but the technical setup suggests the potential for further appreciation if resistance levels are cleared, while downside risks remain if key support levels are breached [1].
CONCLUSION
The US Dollar Index has shown resilience, rebounding above 101.00 amid geopolitical tensions and technical support. While the recovery appears gradual, further gains are possible if resistance levels are surpassed, though downside risks persist if support levels fail. Market sentiment is cautiously optimistic, with the USD outperforming major peers, particularly the Japanese Yen.