The Dollar Attempts a Breakout Amid US-Iran Diplomatic Exchanges

Overview

As of February 26, 2026, the US Dollar is showing signs of strength amidst ongoing tariff chaos and diplomatic discussions with Iran in Geneva. The Forex markets are currently in a consolidation phase, awaiting direction from geopolitical developments.

Market Conditions

The US Dollar has recently broken out of a downward trend, gaining momentum as traders seek clarity in the market. Despite some volatility, major currency pairs have remained within a tight range, indicating a lack of decisive movement. The Australian Dollar, despite positive CPI data, has also struggled to maintain upward momentum.

Technical Analysis of the Dollar Index (DXY)

The Dollar Index (DXY) has confirmed a rebound, holding above a mid-term pivot point of 97.40. The index is currently testing a key resistance level at 98.00, which, if broken, could signal a significant upward breakout. However, a failure to maintain above this level could lead to a correction.

Key Levels to Watch

Resistance Levels:

• 98.00 - Immediate Key Resistance
• 98.80 to 99.00 - Next Resistance
• 99.40 to 99.50 - January Resistance
• 100.376 - November Highs

Support Levels:

• 97.60 - 4H 50 and 200-period MA
• 97.47 - Upward Trendline
• 96.50 to 97.00 - Major Support
• 95.00 - Main Psychological Support

Conclusion

As the US-Iran talks progress, the Dollar's trajectory will likely be influenced by the outcomes of these discussions. Traders are advised to monitor the key resistance levels closely, as a breakout could lead to significant movements across various currency pairs.