• Thu. May 30th, 2024

US Dollar Index grapples to extend its gains, hovers around 103.50

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  • US Dollar Index gains ground due to the Fed’s hawkish stance on interest rate trajectory.
  • US Federal Reserve maintained its current interest rates at 5.50% as expected.
  • Fed Powell indicated a reduced likelihood of imminent rate cuts due to the elevated inflation and robust economic growth.

The US Dollar Index (DXY) continues to gain ground for the second successive day, trading higher around 103.50 during the Asian session on Thursday. The US Dollar (USD) strengthened as Federal Reserve (Fed) Chair Jerome Powell dispelled the possibility of a rate cut in the upcoming March meeting. This outcome was largely anticipated, considering the Fed’s decision to maintain the current interest rates.

Chairman Powell highlighted the persistent existence of elevated inflation and emphasized robust economic growth, indicating a reduced likelihood of imminent rate cuts. The forthcoming jobs and inflation data are anticipated to play a crucial role in guiding market sentiment and influencing the trajectory of the Federal Reserve’s easing cycle.

The Greenback encountered adversity following the release of discouraging US employment figures on Wednesday. The US ADP Employment Change reported 107K, failing to meet the anticipated 145K for January, while the previous reading stood at 158K in December. Thursday is poised to draw attention to key economic indicators, including US Initial Jobless Claims, Nonfarm Productivity, and ISM Manufacturing PMI.

Additionally, the Federal Open Market Committee (FOMC) does not foresee contemplating a reduction in the target range unless it attains heightened confidence that inflation is steadily advancing toward the 2.0% target. Despite a moderation in inflation over the past year, it remains at an elevated level. The statement excludes any mention of additional policy firming.

Anticipation in the market regarding the Federal Reserve’s future decisions is extending into the May meeting. According to CME’s FedWatch Tool, there is a probability of over 60% that the Fed will keep its interest rates within the range of 5.25-5.50% during March’s meeting. As a result, the likelihood of a quarter-point rate cut in May surpasses 60%.

DOLLAR INDEX SPOT: TECHNICAL LEVELS TO WATCH

OVERVIEW
Today last price 103.54
Today Daily Change 0.03
Today Daily Change % 0.03
Today daily open 103.51
TRENDS
Daily SMA20 103.01
Daily SMA50 102.82
Daily SMA100 104.29
Daily SMA200 103.53
LEVELS
Previous Daily High 103.74
Previous Daily Low 102.94
Previous Weekly High 103.82
Previous Weekly Low 102.77
Previous Monthly High 103.82
Previous Monthly Low 101.3
Daily Fibonacci 38.2% 103.44
Daily Fibonacci 61.8% 103.25
Daily Pivot Point S1 103.06
Daily Pivot Point S2 102.6
Daily Pivot Point S3 102.26
Daily Pivot Point R1 103.85
Daily Pivot Point R2 104.2
Daily Pivot Point R3 104.65
On Key

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