Those of you who have been following my analysis over the years will recall I’ve been a US dollar index ($DXY) bear, going all the way back to the major (long-term) bearish spike reversal posted during January 2017. Yes, that initial downtrend took the $DXY to a low of 88.21 during February 2018, a month that saw a bullish spike reversal, sending the greenback off on another major uptrend. Then came March 2020 when anyways analysis was both right and wrong. However, I had turned bearish again with the bearish key reversal during October 2019. What to do with the craziness of February, March, April, and May 2020? for now I’ll just ignore it.
As we head into September, the $DXY has extended its major downtrend to a low of 91.74, its lowest mark since April 2018. However, monthly stochastics (bottom study) are well below the overbought level of 20% and in position for a bullish crossover if the dollar can hold firm though the close this month. Yes, a lot can happen over the course of the month (one of the reasons I employ the Goldilocks Principle when I can), but it certainly looks like the $DXY could be in position to turn bullish again.