DXY ANALYSIS 11/07/24
Updated
Scenario 1: Higher CPI
Bullish Factors:
High Treasury Yields: Higher CPI indicates increased inflation, prompting the Federal Reserve to consider raising interest rates, leading to higher treasury yields.
Low Unemployment: An overheating economy typically shows low unemployment rates.
Overheating Economy: Inflationary pressures suggest strong economic activity, which can boost the DXY.
Technical Targets:
If the CPI data surpasses expectations, the DXY could move towards the resistance levels indicated in the chart around 108.073 to 108.403.
Scenario 2: Lower CPI
Bearish Factors:
Decreasing Treasury Yields: Lower CPI suggests deflationary pressures, potentially leading the Fed to lower or maintain interest rates, resulting in lower treasury yields.
Increasing Unemployment: A cooling or contracting economy often comes with rising unemployment rates.
Technical Targets:
If the CPI data comes in lower than expected, the DXY might drop towards the support levels around 102.355 to 102.643.
Key Levels to Watch
Higher CPI: Targets around 108.073 to 108.403
Lower CPI: Targets around 102.355 to 102.643
Core CPI m/m: Expected 0.2%
CPI m/m: Expected 0.1%
CPI y/y: Expected 3.3%
Based on these expectations, market reactions will depend on whether the actual data deviates from these figures.
Bullish Factors:
High Treasury Yields: Higher CPI indicates increased inflation, prompting the Federal Reserve to consider raising interest rates, leading to higher treasury yields.
Low Unemployment: An overheating economy typically shows low unemployment rates.
Overheating Economy: Inflationary pressures suggest strong economic activity, which can boost the DXY.
Technical Targets:
If the CPI data surpasses expectations, the DXY could move towards the resistance levels indicated in the chart around 108.073 to 108.403.
Scenario 2: Lower CPI
Bearish Factors:
Decreasing Treasury Yields: Lower CPI suggests deflationary pressures, potentially leading the Fed to lower or maintain interest rates, resulting in lower treasury yields.
Increasing Unemployment: A cooling or contracting economy often comes with rising unemployment rates.
Technical Targets:
If the CPI data comes in lower than expected, the DXY might drop towards the support levels around 102.355 to 102.643.
Key Levels to Watch
Higher CPI: Targets around 108.073 to 108.403
Lower CPI: Targets around 102.355 to 102.643
Core CPI m/m: Expected 0.2%
CPI m/m: Expected 0.1%
CPI y/y: Expected 3.3%
Based on these expectations, market reactions will depend on whether the actual data deviates from these figures.
Note
🟥 The US dollar is on alert, waiting for the CPI.. 🇺🇸🔥 7 minutes leftTrade active
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🔷SL : 2453.30
🔷TP : 2414.50
Note
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🔵 Urgent 🔥🔥:🌟 For the first time in 36 months, inflation in America fell to 3%.
👈 The Fed will now seriously consider reducing interest rates soon.. 🇺🇸🏛
⬅️ Strongly negative for the US dollar and strongly positive for gold.. ✅
Note
🚨 Urgent:• Probabilities of cutting US interest rates at the next meeting rise to 83% after positive inflation data.
🌟 Before today's inflation report, markets saw a 67% chance of a rate cut by the next meeting.
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