U.S. Dollar IndexShort
Will the Dollar Retrace After Retail Sales Data?
Macro theme:
- The dollar hovered near a one-year high ahead of today’s Oct Retail Sales report. Markets expect a 0.3% MoM increase, down from Sep's 0.4%.
- Fed Chair Jerome Powell indicated no urgency to lower rates, citing steady economic growth, a strong job market, and persistent inflation.
- According to the CME FedWatch tool, expectations for a 0.25% rate cut next month have dropped to 62.4% from 82.5% a day ago.
Technical theme:
- The market tests the one-year high area around 107.00, confluence with the 78.6% Fibonacci Extension. The index is stretched to the upside and above both EMAs, indicating a potential mean reversion.
- If DXY cannot remain above 106.35, the index may retrace further to retest 105.43.
- On the contrary, if DXY extends its gain above 107.00, the index may retest 107.78, confluence with the 100% Fibonacci Extension.
Analysis by: Dat Tong, Senior Financial Markets Strategist at Exness
- The dollar hovered near a one-year high ahead of today’s Oct Retail Sales report. Markets expect a 0.3% MoM increase, down from Sep's 0.4%.
- Fed Chair Jerome Powell indicated no urgency to lower rates, citing steady economic growth, a strong job market, and persistent inflation.
- According to the CME FedWatch tool, expectations for a 0.25% rate cut next month have dropped to 62.4% from 82.5% a day ago.
Technical theme:
- The market tests the one-year high area around 107.00, confluence with the 78.6% Fibonacci Extension. The index is stretched to the upside and above both EMAs, indicating a potential mean reversion.
- If DXY cannot remain above 106.35, the index may retrace further to retest 105.43.
- On the contrary, if DXY extends its gain above 107.00, the index may retest 107.78, confluence with the 100% Fibonacci Extension.
Analysis by: Dat Tong, Senior Financial Markets Strategist at Exness
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I’ve taken a break from my public community engagements to focus on raising my three kids, but I'm rediscovering my passion for working again. Stay connected, as I plan to return and rejoin my old communities with a lot of new skills one day soon.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.