The proportion of currency instruments EUR / USD, GBP / USD and USD / JPY in calculating the dollar index #USDX is 83.1%. Thus, let's see how these instruments will behave in the market from July 24, 2019.
Minuette (H4 time frame)
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US dollar Index
From July 24, 2019, the development of the dollar index movement #USDX will be due to the testing and direction of the breakdown of the 1/2 Median Line channel boundaries (97.60 - 97.45 - 97.30) of the Minuette operational scale. The movement options within this channel are presented in the animated graphics.
If the support level of 97.30 is broken, (the lower boundary of the 1/2 Median Line channel of the Minuette operating scale fork) together with the 1/2 Median Line Minuette (97.25), the downward movement of the dollar index will be directed to the targets - the initial SSL line (97.00) of the Minuette operating scale fork - the lower boundary ISL38.2 (96.90) equilibrium zone of the Minuette operational scale fork - control line LTL Minuette (96.82) - final Schiff Line Minuette (96.67).
In the case of the breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 97.60), the forwarded Minuette operational scale movement #USDX will continue in the equilibrium zone (97.55 - 97.75 - 97.95) of the Minuette operating scale with the prospect of reaching the ultimate Schiff Line Minuette (98.10).
The details of the #USDX movement within the channel are shown in the animated graphics.
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Euro vs US dollar
The development and direction of the breakdown of the equilibrium zone (1.1140 - 1.1170 - 1.1200) of the Minuette operational scale fork will determine the further development of the movement of the common European currency EUR / USD from July 24, 2019. Let's look at the illustration.
The breakdown of the upper boundary of the ISL38.2 (resistance level of 1.1200) of the equilibrium zone of the Minuette operational scale fork will direct the EUR / USD movement to the boundaries of the equilibrium zone (1.1215 - 1.1255 - 1.1290) of the Minute operational scale fork.
On the other hand, if the EUR / USD breaks the lower boundary of the ISL61.8 (support level of 1.1140) equilibrium zone of the Minuette operational scale fork, then there will be a continuation of the development of the downward movement to the local minimum of 1.1107 and the final FSL line (support level of 1.1100) of the Minuette operation scale fork.
The details of the EUR / USD movement options are shown in the animated graphics.
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Great Britain pound vs US dollar
Her Majesty's currency GBP / USD continues to remain in the 1/2 Median Line channel (1.2500 - 1.2455 - 1.2415) of the Minuette operating scale fork, and accordingly, the further development of the movement of this instrument will depend on the development and direction of the breakdown of the specified higher levels. Let's see the options for the movement within this channel in the animated graphics.
The breakdown of the resistance level of 1.2570 at the upper boundary of the 1/2 Median Line channel Minuette will confirm the further movement of the GBP / USD which will begin to flow into the 1/2 Median Line channel (1.2500 - 1.2540 - 1.2575) of the Minuette operating scale fork with the prospect of reaching the ultimate Schiff Line Minuette (1.2635).
The breakdown of the lower boundary of the 1/2 Median Line channel Minuette (support level of 1.2415) will determine the further development of the downward movement of Her Majesty's currency to the targets - the local minimum (1.2381) - warning line LWL38.2 Minuette (1.2360) - warning line LWL61.8 Minuette (1.2285) - control line LTL Minuette (1.2265).
The details of the GBP / USD movement can be seen in the animated graphics.
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US dollar vs Japanese yen
The further development of the movement of the "currency of the rising sun" USD / JPY from July 24, 2019 will be determined by the direction of the range breakdown:
- resistance level of 108.40 (lower boundary of ISL38.2 equilibrium zone of the Minuette operating scale fork);
- support level of 108.20 (upper boundary of the 1/2 Median Line channel of the Minuette operating scale fork)
The breakdown of the support level of 108.20 will confirm the development of the USD / JPY movement within the 1/2 Median Line channel (108.20 - 107.75 - 107.32) of the Minuette operating scale with the prospect of updating the local minimum 107.32 and reaching the minimum 106.80.
Meanwhile, in the case of the breakdown of ISL38.2 Minuette (resistance level of 108.40), the development of the "currency of the rising sun" movement will continue within the boundaries of the equilibrium zones of the Minuette operational scale fork (108.40 - 108.70 - 109.00) and Minuette (108.85 - 109.50 - 110.15).
The details of the movement options of USD / JPY are presented in the animated graphics.
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The review was compiled without taking into account of the news background. The opening of trading sessions of the main financial centers does not serve as a guide to action (placing orders "sell" or "buy").
The formula for calculating the dollar index is:
USDX = 50.14348112 * USDEUR0.576 * USDJPY0.136 * USDGBP0.119 * USDCAD0.091 * USDSEK0.042 * USDCHF0.036.
where power ratios correspond to the weights of currencies in the basket:
Euro - 57.6% ;
Yen - 13.6% ;
Pound sterling - 11.9% ;
Canadian dollar - 9.1%;
Swedish krona - 4.2%;
Swiss franc - 3.6%.
The first coefficient in the formula gives the index value to 100 on the date of the beginning of the countdown - March 1973, when the main currencies began to be freely quoted relative to each other.
The material has been provided by InstaForex Company - www.instaforex.com