In a November 4, 2025, Barchart article, I asked why the dollar index was stuck in neutral. I concluded the article with the following:
The dollar index is stuck in neutral in early November 2025, but it is consolidating near the low end of its recent trading range. The odds currently favor a continuation of the lower lows and lower highs and bearish trend in place since the high in early 2025.
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The dollar index was trading at 99.83 on November 3, 2026, and while it reached a lower low in Q1 2026 at 95.55, the lowest level since Q1 2022, the index was near the 99 level in April 2026. The dollar index rose 1.75% in Q1 2026, closing the quarter at 99.759 on the nearby futures contract.
Since the U.S. dollar has been the world’s reserve currency for years, most commodities worldwide use it as their pricing currency.
A weakening dollar tends to support raw material prices by making them cheaper in other currencies, prompting increased consumption. Conversely, a stronger U.S. currency often weighs on commodity prices, as it makes them more expensive in other currencies. The dollar’s level relative to other currencies is only one factor affecting raw material prices. Interest rates, idiosyncratic supply and demand factors, macroeconomic factors, and geopolitics are also critical factors in prices.
As the U.S. dollar’s path is one of the factors to consider when forecasting the path of least resistance for commodity prices, commodity traders and analysts watch the dollar index, which measures the dollar’s strength or weakness against other leading reserve currencies.
The monthly chart shows that the dollar index reached a peak of 114.78 in September 2022, where it ran out of bullish steam. The index fell 16.75% to its most recent low of 95.55 in January 2026. At just under 97.80, the index remains in a bearish trend, not far above the early 2026 low and the first technical support level.
The 20-year monthly chart of the dollar index shows a markedly different technical picture.
