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• The US Dollar enjoyed a very consistent performance since the onset of the US-Iran conflict but now forms a double-top
• With Traders starting to price a resolution for the conflict, the Dollar could lose some steam, particularly at the top of its range
• US Dollar Index (DXY) in-depth Technical Analysis

Timing Markets is a difficult task, absolutely key to generating as much profit as possible from important fundamental setups.

It is indeed important to be timely with your trade to ensure that entries remain favorable and the risk-reward remains positive – but an essential part of timing is not being too early.

The US Dollar has been on a significant uptrend since the end of the January FOMC (as forecasted here) and is now testing the extremes of its gigantic 95.50-100.50 range.

This is where timing entries is a daunting task – one could just begin shorting the US Dollar as soon as it reaches its highs, but when double tops occur, they often come to get your stops.

That is when confirmation steps in to provide even more favorable entries and timing – It can be Fundamental, with a change in narrative (something that is kind of emerging as of late), or a confirmation in Technicals.

Sometimes it can actually be both, and this is what could now be offered in the US Dollar.

Nothing is sure in Markets, particularly during volatile periods when breaking news can change the entire picture in a matter of a few seconds – but at least, some setups can look better than others.

As we speak, the US Dollar is rejecting its War highs for the third consecutive test, forming a Double Top – Both the US and Israel are slowly looking to turn the page on the full month of operations, particularly with the Trump Administration considering ending the conflict without taking control of the Strait of Hormuz to punish against European and Asia allies that did not manifest their appetite for such operations (and even went against it, like Spain).

The reversal, if it does arrive, may not unfold in one session but progressive waves as the narrative slowly switches.

Crude Oil prices still dictate general Market flows, so its drop will have to be the extra confirmation signal.

We’ll explore a few scenarios for a potential large reversal in an in-depth technical analysis of DXY.

Dollar Index (DXY) Multi-Timeframe Analysis

Daily Chart

Dollar Index (DXY) Daily Chart. March 31, 2026 – Source: TradingView

While headline chasers are getting fooled by the latest dedollarization and end of the World narrative, as traders it is essential to take a step back, mute the noise, and see if any real trend is emerging to avoid falling into Confirmation Bias loops and miss on significant opportunities.

For example, the same happened after the pre-FOMC Trump-led US Dollar flash-crash, where the world of Finance could have swore as a whole that the USD was finished.

Yet here we are at 6-month highs. The significant range established after the July 2025 TACO Dollar lows is still holding (despite having wicked above and below).

Now reacting at its highs, it will be interesting to see if a downside reversal occurs from here, particularly after the double top and a Daily RSI bearish divergence.

4H Chart and Technical Levels

Dollar Index (DXY) 4H Chart. March 31, 2026 – Source: TradingView

The Dollar is officially rejecting its 100.50 War highs, forming the famous double top, with momentum quickly shifting.

As long as prices remain within the 100.00 to 100.50 Zone, the action is more balanced than bearish, hence it could be a decent time to look around Markets for interesting setups – Two elements to look for are:

• Are buyers returning at short-term support levels ?(4H 50-MA & January Uptrend ~ 99.70)
• If they don't, what is the most optimal FX pair to trade to capture the potential reversal?
• In that event, look for trades expressing this view in other FX pairs (AUD/USD, USD/JPY, USD/CAD?)
  • And don't forget that such reversal don't occur in one swift move! They also have pullbacks and more.

Levels to place on your DXY charts:

Resistance Levels

• 100.00 to 100.50 Main resistance and Range highs
• War Highs 100.544 (Double Top)
• May 2025 Resistance 101.30 to 101.80
• Major Weekly Resistance 102.50 to 103.00

Support Levels

• 99.70 mini-support
• 99.40 to 99.50 Momentum Pivot (bearish below)
• 98.70 to 99.00 Support
• 98.00 Key Mid-Range Support
• Support 97.40 to 97.60
• 2025 Lows Major support 96.50 to 97.00

1H Chart

Dollar Index (DXY) 1H Chart. March 31, 2026 – Source: TradingView

The US Dollar is now slightly mean-reverting after quickly reaching oversold 1H RSI levels – look for a small retracement for entries on Major FX pairs.

Psychological levels tend to attract decent reactions in FX, returning to the 50-hour MA (100.30) would provide an optimal short-USD setup, as long as the narrative doesn't switch again and the war drags on for much longer.

To void the short-setup, watch if bulls manage to drag the Dollar above 100.55 and close above it on the daily.

Safe Trades!

US consumer confidence edged higher in March, with the Conference Board index rising from 91.0 to 91.8, beating expectations of 88.3. The improvement was driven by a stronger assessment of current conditions, with the Present Situation Index jumping from the previous month by 4.6 points to 123.3. However, the forward-looking picture deteriorated. The Expectations Index fell from 72.6 to 70.9, remaining below the 80 threshold typically associated with recession signals.

The divergence highlights a consumer base that sees current conditions as stable but remains increasingly cautious about the outlook, particularly as geopolitical risks and rising costs weigh on sentiment.

Inflation concerns are clearly re-emerging as a dominant theme. Survey responses showed heightened worries about the cost of living, with mentions of oil, gas, and war rising sharply alongside the Iran conflict. Consumers’ 12-month inflation expectations surged to levels last seen in August 2025, while expectations for higher interest rates jumped markedly, from 34.9% to 42.4%.

Full US consumer confidence release here.

Markets

Stock markets drew some minor comfort from the Wall Street Journal story. European equities rose another 0.8%, pulling the likes of the EuroStoxx50 away from key support areas around 5500. Main US indices add around 1%. The US business newspaper citing administration officials said that US president Trump is considering to exit the Iran war even if the Straight of Hormuz remains largely blocked. It’s another U-turn in tone which, just yesterday, was all about bombing plants, stealing uranium and sending more troops to the region. Meanwhile headlines hit the screen of a US-Israeli attacking desalination plants on the Qeshm island located near the Strait. We’d take it with a grain of salt. Brent does so to with the price of a barrel of oil holding well above the triple digits. That’s not enough to completely derail economies but materially higher than one month ago and destined to inject strong upward price pressures. While at the matter, European CPI captured the first impact of the energy price shock with the March print matching our inhouse nowcast of 2.5% y/y on a headline basis, up from 1.9%. Monthly prices rose a strong 1.2%, strongly lifted by a 6.8% m/m energy price rally. Core inflation eased to 2.3% from 2.4% while services CPI decelerated to 3.2% from 3.4%. That does little to ECB market expectations though. There’s still a cumulative 70bps+ in rate hikes priced in for this year with a 50-50 chance for a first move next month. ECB’s Muller said he cannot rule out such a scenario while Radev sees external shocks feeding into price expectations, perhaps referring to worrying signals coming from yesterday’s EC’s Economic Sentiment Indicator. German bund yields by and large ignored the CPI outcome and whipsawed to currently trade slightly lower at the long end of the curve (+/- 2 bps). USTs outperform, sending rates between 2.4 and 5 bps lower. An improved risk environment and having interest rate differentials working against, the US dollar loses out against most global peers. The trade-weighted DXY’s test of key resistance around 100.5 failed and prompted return action lower. EUR/USD bounced back to north of 1.15. Even JPY gets some respite, allowing USD/JPY to drift lower to 159.3.

News & Views

Polish consumer prices rose by 1% M/M and 3% Y/Y in March (vs 2.1% Y/Y last month). The rise was mainly due to fuel prices rising 15.4% M/M and 8.5% Y/Y. Electricity, gas and other fuel prices declined 0.1% M/M with yearly inflation holding at 3.9%. Food price inflation was flat on a monthly basis and 2% Y/Y. The National Bank of Poland (NBP) targets inflation of 2.5% ( +/- 1%pt tolerance). The NBP cut its policy rate by 25 bps at the March 4 meeting based on a further easing of inflation in at the start of the year and favourable new (inflation) forecasts available at the time. In first comments from NBP MPC members since the conflict in the Middle East mostly were reluctant at guiding for interest rate hikes anytime soon. Markets currently err to hikes in the second half of the year. The zloty weakened from near EUR/PLN 4.22 to test the 4.30 area at the early stages of the war in the Middle East. At EUR/PLN 4.29, an orderly correcting zloty now trades at the weaker side of the EUR/PLN 4.25/4.30 range that guided trading over the previous three weeks.

Riksbank (RB) governor Eric Thedeen today commented on the recent developments. At the March 19 meeting, the RB held the forecast for the policy rate to stay at 1.75% this year. As the war in the Middle East continues, Thedeen sees the economic consequences to be ‘more extensive and protracted’. Monetary policy cannot prevent energy prices from rising but the RB wants to avoid them from spreading. “One insight from recent years is that it is risky for a central bank to assume that it is possible to see through supply shocks. If the risks of spillover effects and persistently higher inflation increase, we may need to tighten monetary policy”, Thedeen assesses. However, for now, the RB governor assumes RB can take a wait-and-see approach as inflation is relatively low to start with. February CPIF and CPIF ex energy inflation were respectively 1.7% Y/Y and 1.4% Y/Y. Markets see only a limited (< 20%) chance on an RB rate hike in May. A 25 bps (+) step is only discounted by August. After a protracted rise against euro from November to early February (EUR/SEK 10.50 best since august 2022), the krone retreated. In February markets still saw a chance for the RB to cut the policy rate even further. In March, this was reversed, but the RB is still seen lagging the likes of the ECB when it comes to addressing inflationary risks. EUR/SEK currently trades near 11.95.

Canadian GDP ticked higher by 0.1% month-on-month (m/m) in January slightly edging out Statistics Canada's advanced guidance and market expectations for a flat reading.

Compositionally, 9 of 20 industries registered an increase on the month. Goods industries rose for a second consecutive month (0.2% m/m), while the services sector recorded no growth.

Oil and gas extraction (+1.6% m/m) and the construction sector (+1.1% m/m) pushed the overall goods sectors higher in January. This offset the contraction in the manufacturing sector, dragged lower by motor vehicles and parts manufacturing (-10.8% m/m).

On the services side, decreases in wholesale trade (-1.2% m/m), transportation and warehousing (-0.7% m/m) and real estate (-0.2% m/m) were offset by solid gains in retail trade (0.8% m/m) and finance and insurance (0.5% m/m).

Advanced guidance calls for an acceleration in February's real GDP growth to 0.2% m/m, led by a manufacturing rebound and continuing strength in mining and finance and insurance.

Key Implications

Canada's economy looks to be off to a slightly better-than-expected start in 2026 after a lackluster fourth quarter. With January's print and a flash estimate for February, Q1-2026 growth is tracking in-line with historical trend growth, a view shared by both us and the Bank of Canada. It's worth noting that quarterly expenditure-based GDP growth has been particularly volatile due to sharp movements in trade and inventories, something not well captured in the monthly industry GDP accounts.

Today's data shouldn't impact the Bank of Canada's next policy decision on April 29th. Instead, the recent U.S.-Iran war is keeping the BoC more forward looking, with the economic outlook highly dependent on how long and severe the conflict becomes. The Bank will closely monitor this shock – weighing downside risks to growth against the upside inflationary impacts – and stand ready to respond. For now, we maintain our view that the BoC has reached the end of their interest rate easing cycle.

Daily Pivots: (S1) 1.1429; (P) 1.1476; (R1) 1.1509; More….

EUR/USD recovered ahead of 1.1408 support as consolidations continue. Intraday bias remains neutral for the moment. Further decline is expected with 1.1666 cluster resistance (38.2% retracement of 1.2081 to 1.1408 at 1.1665) intact. On the downside, firm break of 1.1408 will resume the fall from 1.2081 to 38.2% retracement of 1.0176 to 1.2081 at 1.1353. However, decisive break of 1.1666 will argue that the fall from 1.2081 has completed, and turn bias back to the upside for 61.8% retracement of 1.2081 to 1.1408 at 1.1824.

In the bigger picture, prior break of 55 W EMA (now at 1.1497) should confirm rejection by 1.2 key cluster resistance level. The whole up trend from 0.9534 (2022 low) might have completed as a three wave corrective rise too. Deeper fall is expected to long term channel support (now at 1.0535). Meanwhile, risk will stay on the downside as long as 1.2081 holds, even in case of strong rebound.

Daily Pivots: (S1) 1.3144; (P) 1.3213; (R1) 1.3253; More...

A temporary low is formed at 1.3158 with current recovery, and intraday bias in GBP/USD is turned neutral. Some consolidations could be seen, but outlook will remain bearish as long as 1.3479 resistance holds. Below 1.3158 will resume the fall from 1.3867 to 61.8% projection of 1.3867 to 1.3216 from 1.3479 at 1.3077 first. Decisive break there could prompt downward acceleration through 1.3008 support to 100% projection at 1.2828.

In the bigger picture, considering bearish divergence condition in both D and W MACD, a medium term top should be in place at 1.3867. Firm break of 1.3008 support will argue that fall from 1.3867 is at least correcting the rise from 1.0351 (2022 low) with risk of bearish reversal. That would open up further decline to 38.2% retracement of 1.0351 to 1.3867 at 1.2524. For now, medium term outlook will be neutral at best as long as 1.3867 resistance holds, or until further development.

Daily Pivots: (S1) 159.17; (P) 159.82; (R1) 160.39; More...

Intraday bias in USD/JPY remains neutral for the moment. On the downside, sustained break of 55 4H EMA (now at 159.27) should confirm short term topping at 160.45, on bearish divergence condition in 4H MACD. Deeper fall should then be seen to 157.49 support to correct the rally from 152.25. Nevertheless, strong rebound from current level, followed by 160.45, will target 161.94 high.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 152.97) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.

Daily Pivots: (S1) 0.7969; (P) 0.7991; (R1) 0.8019; More….

With 0.7951 minor support intact, intraday bias in USD/CHF stays mildly on the upside despite some loss of momentum. Current rally from 0.7603 should target 38.2% retracement of 0.9200 to 0.7603 at 0.8213. On the downside, below 0.7951 minor support will turn intraday bias neutral first. But further rally is expected as long as 0.7833 support holds, in case of retreat.

In the bigger picture, a medium term bottom should be in place at 0.7603 on bullish convergence condition in D MACD. Rebound from there is seen as correcting the fall from 0.9200 only. However, decisive break of 55 W EMA (now at 0.8088) will suggest that it's probably correcting the larger scale down trend from 1.0146 (2022 high). On the other hand, rejection by the 55 W EMA will setup down trend resumption to 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382 at a later stage.

Global markets are frozen as traders grapple with conflicting interpretations of U.S. President Donald Trump’s latest post on the Iran war, leaving oil prices rangebound near 110 and broader price action lacking conviction. The message introduces competing scenarios with sharply different implications for supply, creating pricing paralysis across assets. While European recovered along with US futures, there was not clear momentum for a genuine reversal. Dollar's retreat today looked more like a consolidation than a turnaround.

In the post, Trump declared that Iran has been “essentially decimated” and that “the hard part is done,” while telling allies to “go to the Strait, and just TAKE IT” and warning that “the U.S.A. won’t be there to help you anymore.” The language suggests a redefinition of success, where achieving military objectives no longer requires reopening the Strait of Hormuz.

One interpretation is that this signals a shift toward containment. Under this view, the U.S. is preparing to step back even if no deal is reached by April 6, leaving affected countries to manage the reopening of shipping lanes. This aligns with earlier reporting of an exit strategy and would likely place a ceiling on oil prices, with Brent potentially easing toward 100 as risks stabilize rather than escalate.

However, an opposing scenario remains equally plausible. Trump’s comments can also be read as insulating the U.S. from the consequences of further escalation. By telling allies to “go get your own oil,” Washington creates political cover if massive infrastructure strikes on Iran proceed and the Strait remains closed. In this case, supply disruptions would intensify sharply, pushing oil prices significantly higher.

A third risk lies in inaction. If the April 6 deadline passes without either a deal or escalation, the “Maximum Pressure” strategy risks losing credibility, weakening U.S. leverage in upcoming negotiations, including the U.S.-China summit in particular. At the same time, Iran’s move toward selective access to the Strait raises the prospect of a structural bottleneck in global energy flows.

These competing scenarios—containment, escalation, or policy erosion—are leaving markets unable to form a dominant narrative. Oil’s tight range around 110 reflects a balance between downside caps and upside risks, while equities and gold show similarly subdued, directionless moves.

In currency markets, Dollar is easing mildly but the move lacks follow-through, consistent with consolidation rather than reversal. Elevated energy prices and inflation risks continue to provide an underlying bid, even as near-term momentum softens.

Euro is holding steady following March CPI data, where headline inflation rose to 2.5% while core inflation edged lower. The divergence complicates the ECB’s outlook, with an April rate hike still likely but not certain. Much will depend on how persistent energy costs prove and how quickly they feed into core inflation.

Yen failed to extend gains despite recent intervention rhetoric, as USD/JPY is no longer pressing the 160 threshold. Without that trigger, demand for Yen has faded. For the week so far, Yen remains the strongest performer, followed by Aussie and Dollar, while Kiwi lags, reflecting a market driven more by positioning than conviction.

In Europe, at the time of writing, FTSE is up 1.01%. DAX is up 1.03%. CAC is up 0.82%. UK 10-year yield is down -0.049 at 4.829. Germany 10-year yield is down -0.024 at 3.011. Earlier in Asia, Nikkei fell -1.58%. Hong Kong HSI rose 0.15%. China Shanghai SSE fell -0.80%. Singapore Strait Times fell -0.24%. Japan 10-year JGB yield closed flat at 2.359.

Silver Price Gains “Oxygen” from Yield Pullback; Break Above 74.52 to Confirm Momentum

Silver price rebounded as US yields pulled back from the 4.5% level and Powell’s comments eased expectations for further Fed tightening. The move has provided “oxygen” for metals, but a break above 74.52 is needed to confirm upside momentum. Further gains depend on sustained yield weakness or easing geopolitical risks. Read More.

Canada GDP Edges Higher as Resource Sector Offsets Manufacturing Weakness

Canada’s economy grew 0.1% in January, supported by strength in resource sectors despite weakness in manufacturing. Services activity was broadly flat, highlighting uneven momentum. Early estimates suggest a stronger 0.2% expansion in February, pointing to modest but ongoing growth. Read More.

Eurozone CPI Jumps to 2.5% as Energy Drives Rebound, Core Inflation Eases Slightly

Eurozone CPI jumped as energy inflation rebounded sharply, but cooling core prices suggest underlying pressures remain contained. The ECB now faces a more complex policy trade-off. Read More.

RBA Minutes Highlight Excess Demand and Oil Shock as Case for Further Tightening

RBA raised rates to 4.10% in a split 5–4 decision, with minutes showing growing concern over oil-driven inflation risks. The Board signaled more tightening may be needed, despite uncertainty around growth and the Middle East conflict. Read More.

China PMIs Return to Expansion as Output and Orders Rebound, but Cost Pressures Surge

China’s Manufacturing PMI rose to 50.4 in March, signaling a return to expansion as production and new orders improved. However, input costs surged sharply, while output prices lagged, pointing to growing margin pressure. Non-manufacturing activity also edged back into expansion. Read More.

NZ ANZ Business Confidence Tumbles to 32.5 as Cost Pressures Surge to Highest Since 2023

New Zealand business confidence tumbled in March as cost pressures surged to the highest since 2023, with more firms expecting to raise prices. Inflation expectations also climbed while activity outlook weakened, pointing to a growing stagflation risk. Read More.

Japan Tokyo CPI Core Weakens to 1.7% as Energy Subsidies Drag Inflation Lower

Tokyo CPI slowed to 1.7% in March, marking a second month below the BoJ’s 2% target as energy subsidies continued to suppress prices. However, the sharp slowdown in gasoline declines points to rising oil pressures beginning to offset policy support. The data highlight a fragile balance between near-term disinflation and emerging upside risks. Read More.

Japan Factory Output Contracts as Auto Weakness Weighs, Outlook Remains Uncertain

Japan industrial production fell -2.1% in February after a 4.3% rise in January, with weakness across most sectors led by autos. Retail sales also disappointed, pointing to soft demand, while unemployment edged lower to 2.6%. The data highlight a mixed outlook with fragile growth but stable labor conditions. Read More.

USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 0.7969; (P) 0.7991; (R1) 0.8019; More….

With 0.7951 minor support intact, intraday bias in USD/CHF stays mildly on the upside despite some loss of momentum. Current rally from 0.7603 should target 38.2% retracement of 0.9200 to 0.7603 at 0.8213. On the downside, below 0.7951 minor support will turn intraday bias neutral first. But further rally is expected as long as 0.7833 support holds, in case of retreat.

In the bigger picture, a medium term bottom should be in place at 0.7603 on bullish convergence condition in D MACD. Rebound from there is seen as correcting the fall from 0.9200 only. However, decisive break of 55 W EMA (now at 0.8088) will suggest that it's probably correcting the larger scale down trend from 1.0146 (2022 high). On the other hand, rejection by the 55 W EMA will setup down trend resumption to 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382 at a later stage.

Canada’s economy expanded by 0.1% mom in January, beating expectations of a flat reading, as strength in resource-related sectors helped offset ongoing weakness in manufacturing.

Goods-producing industries rose 0.2% mom for a second consecutive month, supported by gains in mining, quarrying, and oil and gas extraction, alongside construction and utilities. These gains more than compensated for a contraction in manufacturing.

Services activity, however, showed little momentum. While retail trade and finance and insurance posted increases, these were offset by declines in wholesale trade and transportation and warehousing, leaving the sector broadly unchanged.

Overall, 9 of 20 industries recorded growth, reflecting a mixed but slightly positive economic backdrop.

Looking ahead, advance estimates suggest GDP rose a further 0.2% mom in February, indicating that growth is continuing, albeit unevenly across sectors.

Full Canada's GDP release here.