Dollar Index outlook: Bulls may take a breather after cracking key barriers
|Dollar Index
The Dollar index keeps firm tone and riding on the fresh wave of risk aversion, to crack psychological 100 barrier (also former top of Aug 1) and nearby falling 200DMA (100.15) on Wednesday.
The recent more hawkish than expected remarks from Fed chief Powell faded high expectations for another rate cot in December and boosted the greenback.
Absence of key labor data for the second consecutive month, due to US government closure, added to Fed’s argument about more cautious approach to monetary policy that cooled market bets for December rate cut from 92% to 75%.
The only available report – ADP private sector payrolls, showed better than expected results in October, bringing a dash of optimism about the condition of the US labor sector that would also contribute to current lowered expectations for December policy meeting.
Sustained break of these barriers would generate fresh bullish signal and further strengthen firm bullish structure on daily chart, however, overbought conditions warn that bulls may face headwinds at this zone and pause for consolidation / limited correction.
Potential dips should find footstep above supports at 99.30/20 zone (former top / 10DMA) to keep bulls intact and offer better levels to re-enter bullish market.
Res: 100.18; 100.40; 100.74; 101.10.
Sup: 99.87; 99.53 99.20; 99.05.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.