US Dollar vs Israeli Shekel consolidates as Bank of Israel $801 million USD purchase draws focus

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US Dollar vs Shekel rises 0.63% today

Highlights

The Bank of Israel intervened in May by purchasing $801 million to restrain shekel appreciation and manage forex liquidity.
Israel’s foreign currency reserves climbed to $238.681 billion, as robust foreign investment continues to support shekel strength.
USD/ILS shows strong short- and medium-term upward momentum, with a 2.9263–2.9895 range projected amid overbought conditions and heightened bullish probability.

Dollar buying campaign as central bank curbs shekel appreciation

The Bank of Israel’s $801 million purchase of US dollars in May, as reported by cryptobriefing.com, marks the first currency intervention since 2022 and is primarily aimed at curbing the shekel’s appreciation by increasing US dollar demand and directly affecting liquidity conditions. This action reflects the central bank’s intent to maintain orderly forex market operations, with the intervention officially characterized as a one-off measure rather than an ongoing defense of any specific rate. Israel’s foreign exchange reserves subsequently rose to $238.681 billion, largely due to revaluation gains, while broader shekel strength continues to be supported by increased foreign investment and favorable international market trends.

Mixed momentum and overbought signals as range narrows

On the H1 chart, USD/ILS remains above the MA-20 (₪2.9377) and MA-50 (₪2.9428), but below the long-term MA-200 at ₪3.1000. The Ichimoku Kijun at ₪2.9397 serves as immediate support. The MACD signal indicates a Buy, while the ADX shows a Neutral setting. Oscillator readings are mixed: RSI is at 61.25 (Buy), but both Stoch RSI and CCI are in Overbought territory, and BBP signals buyer dominance. Intraday price action shows moderate volatility with a gap of -0.0053 near today’s high. These mixed momentum and oscillator signals suggest a divergence between continued bullish activity and the risk of near-term exhaustion.

High probability of consolidation as tight band contains risk

Over the next 2–3 trading days, USD/ILS is expected to consolidate within the ₪2.9263 to ₪2.9895 price range, representing the volatility band relative to current levels. There is a very high probability of an upward move, while the likelihood of a downward break is classified as very low. In the baseline scenario, price is likely to hold in this corridor. A bullish scenario emerges if resistance is breached, whereas a bearish move would likely develop if the Kijun support at ₪2.9397 gives way.

Viktoras Karapetjanc, expert at Traders Union, highlights that the Bank of Israel’s decisive intervention has set a constructive tone for USD/ILS. He notes strong institutional support for the dollar and ongoing foreign investment flows underpinning the current move. Karapetjanc believes the currency is positioned for further gains, with consolidation likely as long as support at ₪2.9397 holds. The expert sees market sentiment firmly in favor of the upside in the near term. "With fundamentals and central bank policy in alignment, I remain optimistic on USD/ILS holding above ₪2.94 and challenging higher levels this week."

Earlier, analysts noted that while USD/ILS exhibited signs of short-term support, the pair faced a broadly bearish long-term outlook amid mixed technical momentum. The recent central bank intervention introduces a new dynamic to the market, making traders increasingly attentive to how the pair reacts above the Ichimoku Kijun, as sustained buying interest could shift near-term risk toward a fresh breakout.

Source of Data: USD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.