Watch These U.S. Dollar Index Price Levels as Greenback Benchmark Hits 3-Year Low

The U.S. dollar index (DXY) hit a three-year low Monday amid investor concerns about tariffs, the economic outlook and possible threats to Federal Reserve independence.

President Trump on Monday ramped up his criticisms of Fed Chair Jerome Powell and demanded that the central bank cut rates immediately. The latest comments came after Trump last week said Powell’s “termination cannot come fast enough,” while White House economic advisor Keven Hassett said the president is evaluating ways to possibly dismiss Powell.

Investors fear that a move by Trump to remove Powell before the end of the Fed chief’s term in May 2026 could undermine confidence in the U.S. dollar and the country’s dominant role in global financial markets.

The U.S. dollar index, which measures the performance of the greenback against a basket of foreign currencies, has declined about 5% since early April and slumped around 9% since the start of the year amid uncertainty surrounding the Trump administration’s trade policies. The index was at 98.32 late Monday, trading at its lowest levels since March 2022.

Below, we break down the technicals on the U.S. dollar index weekly chart and identify crucial levels worth watching out for amid the potential for further news-driven volatility.

Bull Trap Confirms

After breaking out from a descending triangle last October, the U.S. dollar index rallied for several months but ran into selling pressure as it approached its 2022 high. Since that time, the index has trended sharply lower, recently falling below the pattern’s lower trendline to confirm a bull trap, a trading event that lures investors into buying before the market makes a sudden reversal to cause losses.

However, while the relative strength index (RSI) confirms bearish momentum, the indicator has moved into oversold territory, increasing the likelihood of near-term bounces.

Let’s identify crucial support and resistance levels on the U.S. dollar index chart that investors may be monitoring.

Crucial Support Levels to Watch

The first lower level to watch sits around 95. The index could attract buying interest in this area near a horizontal line that connects multiple peaks and troughs on the chart between October 2017 and January 2022.

A more significant move lower could see the index revisit lower support at 90. Investors may seek entry points in this location near two prominent swing lows that developed on the chart in the first half of 2021, preceding a 15-month bull run.

This area also sits in the neighborhood of a projected measured move downside target that calculates the distance of the descending triangle near its widest point and deducts that amount from the pattern’s lower trendline.

Key Resistance Levels to Monitor

During upswings, it’s worth closely monitoring the key 101 level. Countertrend rallies to this area would likely face selling pressure near the descending triangle’s lower trendline, which may flip from a region of prior support into future resistance.

Further upside could spark a move to around 107. Tactical traders who have accumulated positions in the U.S. dollar index at lower levels may decide to lock in profits here near the notable October 2023 swing high, which also closely aligns with a minor peak that formed on the chart last November.

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As of the date this article was written, the author does not own any of the above securities.