The US Dollar Index has its own charts that need to be read to be understood. Garnering as much information as possible means looking over these charts closely.
Here is the USDX chart:
The chart is updated 24 hours a day, 5 days a week. The index is also measured against a basis of 100.00. This means if the index reads 91.50, then the index has fallen 8.5% since the beginning of your chart. If it reads 111.75 then it has risen 11.75% since the beginning of the chart that you are looking at. This is all very important as it gives you some idea of where the value of the US Dollar is since the beginning of the chart that you have been looking at.
The very beginning of the USDX was in March 1973 when the world’s largest nations all met together to decide that the US Dollar would be permitted to allow to float freely in the markets.
The USDX Formula
The formula, if you decide that you want to look at it for the USDX is as follows:
USDX = 50.14348112 × EUR/USD^(-0.576) × USD/JPY^(0.136) × GBP/USD^(-0.119) × USD/CAD^(0.091) × USD/SEK^(0.042) × USD/CHF^(0.036)
You shouldn’t necessarily need to know this information as it will be automatically calculated for you by the broker that you are using.
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