US dollar index is weighted by the six currencies, namely the euro, the yen, the pound, the Canadian dollar, the Swedish kroner and the Swiss franc, according to their respective proportions. Their respective proportions in the US dollar index are: 57.6% of the euro, 13.6% of the yen, 11.9% of the pound, 9.1% of the Canadian dollar, 4.2% of the Swedish kroner, and 3.6% of the Swiss franc.
is obvious, the euro and the yen together account for more than 70% of the weight of the US dollar index. Since the beginning of this year, the US dollar index has been rising all the way, with unstoppable momentum. On the surface, the reason why the US dollar index soared was mainly due to the Federal Reserve's crazy interest rate hikes and subsequent balance sheet shrinkage, and the continued rise in US bond interest rates, coupled with the influence of geopolitical factors such as the Russian-Ukrainian war.
From this comparison chart, we can see that the euro and the US dollar index are most consistent, and other currencies are also highly affected by the US dollar index.
From the above comparison chart, it can be seen that the U.S. stock Nasdaq and the U.S. dollar index also have certain correlations, but the rise and fall rate is uncertain, and other currencies are also highly affected by the U.S. dollar index.
From the above comparison chart, it can be seen that there is also a certain correlation between gold and the US dollar index, but there is also inconsistency
If you want to do a good job in foreign exchange trading, the first choice is to study the trend of the US dollar index. It is the root cause and determines the rise and fall trends of most varieties.
