US Dollar Index Analysis: A Dominant Bearish Trend

In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the USDX for July 23, 2025.

Technical Analysis of USDXUSDX Daily Chart Insights

• Stochastic Oscillator: The indicator recently completed a bearish crossover, declining from overbought territory. The development indicates weakening upward momentum and a shift toward seller dominance, pointing to a potential retest of recent support levels.

• Key support area: The most critical level for the current trend is the recent swing low from late June 2025, located at approximately 96.460.

USDX 2-hour Chart Analysis

• Bearish formation: The price is now forming a pattern of lower highs and lower lows, which is the hallmark of a downtrend. The Stochastic oscillator is approaching oversold territory below 20, indicating strong bearish momentum. However, the extended downward move may be due for a pause or minor corrective bounce before the downtrend potentially resumes.

• Breakout scenarios: The primary scenario involves a continuation of the current sell-off. A sustained break below the immediate support at 97.050 would likely trigger the next downward leg, targeting the 96.750 – 96.850 support zone initially. The bearish outlook would be invalidated if price reclaims the major resistance zone at 97.710 – 97.820. A decisive break above this area would suggest the sell-off was merely a correction and could shift momentum back to the bulls.

USDX Pivot Indicator

• The steep downward trajectory over the past several sessions indicates that sellers are firmly in control. The Stochastic oscillator has crossed bullishly from oversold levels below 20. The recent downward move may be exhausted, suggesting a short-term bounce or consolidation before the next move.

• Bearish Continuation: Given the oversold stochastic reading, a minor bounce towards immediate resistance at 97.250 or even minor resistance at 97.445 is a high probability. The primary expectation is that sellers will re-emerge at these resistance levels, push the price back down, and eventually break the key support at 97.055 to continue the downtrend.

• Bullish Breakout: A bullish reversal requires significant momentum change and decisive breaks above multiple resistance levels, starting with the black moving average at 97.575. Until then, any upward movement should be viewed as a counter-trend correction.

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