U.S. Dollar IndexShort
DXY BEARISH OUTLOOK
The US dollar index (DXY) experienced a notable decline, hitting a two-month low at 103.6, following its sharpest weekly drop since July. This downward trajectory was fueled by weaker-than-expected inflation data, solidifying expectations that the Federal Reserve might refrain from raising interest rates, leading market sentiment to anticipate potential rate cuts. Despite dovish signals from Fed officials indicating a softer dollar, market pricing has yet to fully incorporate the possibility of the Fed reactivating tightening policies when necessary. The technical analysis suggests a bearish outlook for the dollar, with the breach of key support levels potentially targeting the 102.5 - 103 support zone.
Amidst these developments, the EUR/USD pair rose amid speculations of earlier Fed rate cuts and lower inflation in the Eurozone. Facing resistance at 1.093, it could either advance to 1.1 or decline to $1.083. USD/JPY retreated from pressure at 151, experiencing a sharp decline due to weak US data, though it remains within a rising channel. Gold prices displayed resilience around $1,930 and aim for $1,980; surpassing this level is crucial for further upward movement. While market anticipation of limited data supporting dollar demand persists, the OPEC's decision to cut oil supply amid declining oil prices may prompt short-term dollar purchases. Overall, the market outlook indicates a bearish trend for the US dollar, with pivotal resistance and support levels ahead for major currency pairs, and potential implications from the upcoming Fed meeting minutes.
On a technical note, both RSI and MACD are showing sell signals, further confirming the bearish sentiment for the instrument. If this trend continues, the price might reach levels of 101.68. As a pivot point might be considered 103.775, from where the price might reach resistance levels of 103.89
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Amidst these developments, the EUR/USD pair rose amid speculations of earlier Fed rate cuts and lower inflation in the Eurozone. Facing resistance at 1.093, it could either advance to 1.1 or decline to $1.083. USD/JPY retreated from pressure at 151, experiencing a sharp decline due to weak US data, though it remains within a rising channel. Gold prices displayed resilience around $1,930 and aim for $1,980; surpassing this level is crucial for further upward movement. While market anticipation of limited data supporting dollar demand persists, the OPEC's decision to cut oil supply amid declining oil prices may prompt short-term dollar purchases. Overall, the market outlook indicates a bearish trend for the US dollar, with pivotal resistance and support levels ahead for major currency pairs, and potential implications from the upcoming Fed meeting minutes.
On a technical note, both RSI and MACD are showing sell signals, further confirming the bearish sentiment for the instrument. If this trend continues, the price might reach levels of 101.68. As a pivot point might be considered 103.775, from where the price might reach resistance levels of 103.89
Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.
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