The U.S. Dollar Index (often referred to as USDX, DXY, or just DX) is a crucial measure that reflects the strength of the United States dollar against a collection of foreign currencies. Think of it as a barometer for the dollar's performance, particularly against currencies from key trade partners.
Published and maintained by the Intercontinental Exchange (ICE), the term 'U.S. Dollar Index' is actually a registered trademark. This index is calculated as a weighted geometric mean of the dollar's value in relation to several major currencies:
- Euro (EUR) - 57.6% weight
- Japanese Yen (JPY) - 13.6% weight
- Pound Sterling (GBP) - 11.9% weight
- Canadian Dollar (CAD) - 9.1% weight
- Swedish Krona (SEK) - 4.2% weight
- Swiss Franc (CHF) - 3.6% weight
If you're used to the standard Dollar Index indicator, you'll notice a key difference with this candlestick version. Instead of just showing a single value, it provides a more detailed view by displaying the 'open', 'close', 'high', and 'low' of the dollar index in candlestick format, all in a separate window. This allows you to visualize the intra-bar volatility and offers insights that align more closely with how the index operates in real-time.
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