The US Dollar Index has plummeted more than 4% off the September highs with the sell-off breaking below major multi-year uptrend support last week - the technical implications of this break are massive and suggest a significant shift in the longer-term USD price outlook. That said, the decline looks stretched into the weekly open and the risk for near-term exhaustion rises on a test of parallel support just lower. These are the updated technical targets and invalidation levels that matter on the US Dollar Index weekly price chart

Notes: In last month’s US Dollar Weekly Price Outlook we noted that DXY was, “attempting to break / close below critical support zone at multi-year uptrend support – risk for accelerated losses while below 92.28.” The index spent more than two weeks attempting to break this level before crashing lower into the close of November with the Dollar plummeting another 1.2% into the start of December trade.

Initial support rests with the slope parallel extending off the June 2019 low backed closely by the 88.6% Fibonacci retracement of the 2018 advance at 89.93- look for inflection there IF reached with a break / close below needed to keep the focus on subsequent objectives at the 2010 high at 88.71 & 88.18. Initial resistance now at 91.92-92.28 backed by the highlighted trendline confluence near 92.75 and 93.30s– a breach / close above this threshold would be needed to shift the broader focus higher again in the greenback.

Reference by: Michael Boutros, Technical Strategist with DailyFX