US Dollar Price Forecast: DXY Rises as Hormuz Crisis Deepens

Published: Mar 13, 2026, 11:03 GMT+00:00

Key Points

• Iran's closure of the Strait of Hormuz triggers a surge in safe-haven demand, pushing the Dollar Index (DXY) past 100.
• The British Pound (GBP) falls below its 4-hour trendline support at 1.3260, indicating potential for further declines.
• The Euro (EUR) remains trapped in a bearish channel as energy shocks and increased dollar demand weigh heavily on the currency.

Market Overview

The US dollar has shown continued strength, with the Dollar Index (DXY) hovering around 99.70, reflecting modest gains. The recent geopolitical tensions in the Persian Gulf have significantly influenced this upward trend.

Geopolitical Tensions Support the US Dollar

The situation escalated as Iran's leadership, under Mojtaba Khamenei, has firmly committed to keeping the Strait of Hormuz closed, responding to US military actions in the region. This has led to a rush among investors to purchase US dollars as a safe-haven asset, bolstering the dollar's strength against other major currencies.

Fed Rate Uncertainty and Upcoming Inflation Data

Despite the dollar's strength, uncertainty surrounds the Federal Reserve's monetary policy due to rising inflation driven by oil prices. Investors are closely monitoring upcoming economic releases, particularly the US inflation numbers for January, which are expected to show a headline inflation rate of 2.9% year-over-year and a core inflation rate of 3.1%. If these figures come in lower than anticipated, it could temporarily weaken the dollar, although the ongoing Middle Eastern tensions are likely to keep it strong overall.

US Dollar Index Forecast: Can DXY Sustain Break Above 100?

The DXY is currently testing the 100.08 level after breaking through the 99.70 resistance zone. The index remains above both the 50 and 200-period moving averages, indicating a bullish trend. The Relative Strength Index (RSI) is approaching 65, suggesting increasing momentum but also potential overbought conditions. If the DXY can maintain its position above 99.70, it may target levels of 100.60 and 101.00. Conversely, a failure to hold above this level could lead to a decline towards the 99.25 support level.

GBP/USD Technical Analysis: Bearish Break Signals Further Downside Risk

The GBP/USD pair is currently at 1.3260, having broken through a significant rising trendline support. The price is now below both the 50 and 200-period moving averages, indicating a bearish momentum. The RSI has dropped to 35, reflecting increased downside pressure. Immediate support is seen at 1.3200, followed by 1.3100. A recovery above 1.3400 is necessary to shift the bearish bias.

EUR/USD Technical Forecast: Downtrend Extends Toward 1.1400 Support

The EUR/USD pair struggles near 1.1460 within a downward-sloping channel. The price remains below both the 50 and 200-period moving averages, reinforcing a bearish outlook. The RSI is around 30-35, indicating potential oversold conditions but not yet signaling a reversal. Key support is at 1.1400, and a break below this level could lead to further declines towards 1.1330.

Conclusion

The current geopolitical climate, particularly the tensions surrounding the Strait of Hormuz, is significantly impacting currency markets, particularly the US dollar. As investors seek safe-haven assets, the dollar is expected to maintain its strength, while the GBP and EUR face increasing downside risks.