US Dollar Price Forecast: DXY Sinks to $98.20 – Are GBP/USD and EUR/USD Bulls Unstoppable?
Author: Arslan Ali
Published: April 14, 2026
Key Points
- The Dollar Index (DXY) has dropped below its rising trendline and the 50-SMA, indicating a bearish shift.
- EUR/USD has surpassed its 200-SMA and is maintaining the $1.1750 resistance-turned-support level.
- GBP/USD is on an upward trajectory towards $1.3600, having reclaimed its 200-SMA near $1.3380.
Market Overview
The US dollar is currently influenced by various factors including geopolitical risks, energy market conditions, and expectations regarding Federal Reserve interest rate actions. The breakdown in US-Iran negotiations and the blockade of Iran have heightened fears in global markets, typically benefiting the US dollar as a safe haven currency.
However, rising oil prices are raising concerns about inflation, which could hinder the Fed's ability to cut rates, potentially leading to rate hikes instead. This situation is currently supporting the dollar against currencies reliant on energy imports.
DXY Breakdown Analysis
The DXY is trading around $98.20, having fallen below the rising trendline, confirming a short-term breakdown. The price is testing horizontal support at $98.00, with the 200-SMA at $99.50 acting as a resistance barrier. The RSI indicates weakening momentum, suggesting potential further declines if support fails, with targets around $97.70.
Trade Idea: Sell below $98, targeting $97.70 with a stop above $98.90.
GBP/USD Rally
GBP/USD is currently near $1.3535, continuing its rally within a clear ascending trendline. The price action shows consecutive bullish candles, indicating strong momentum above the 50-SMA ($1.3450) and reclaiming the 200-SMA at $1.3380. The RSI is approaching overbought territory, but the trend remains intact as long as it stays above the rising trendline.
Trade Idea: Buy on a pullback near $1.3480, targeting $1.3600 with a stop below $1.3420.
EUR/USD Breakout
EUR/USD is trading around $1.1780, successfully holding above the $1.1750 resistance level. The price respects the rising trendline and is forming higher lows, with strong bullish candles indicating continued buying pressure. The RSI remains above 60, suggesting no immediate exhaustion in momentum.
Trade Idea: Buy above $1.1750, targeting $1.1860 with a stop beneath $1.1700.
Conclusion
The current market dynamics suggest a complex interplay between geopolitical tensions, inflation concerns, and technical indicators. Traders are advised to remain vigilant and responsive to market data and geopolitical developments that could influence currency movements.