US Dollar Falls Slightly from Two-Week Peak
The US Dollar Index (DXY) weakened slightly in the Asian session on Thursday, dropping to around 97.75 after hitting a two-week high of 98.00 the previous day. This correction erased some of the previous gains, although further declines were limited due to the lack of follow-up selling.
Expectations that the Fed will cut interest rates again in October and December were the main factor pressuring the dollar. However, cautious comments from Fed Chair Jerome Powell regarding the prospect of rate cuts discouraged market participants from aggressively selling the greenback, thus keeping the correction moderate.
From a technical perspective, a close above the 38.2% Fibonacci retracement level of the August-September decline signals support for the dollar. The daily indicator has also begun to enter the positive zone, signaling potential buying action in the 97.50-97.25 area. If 97.25 is broken below, the DXY risks opening further below 97.00, even approaching 96.65.
Conversely, if the dollar manages to break through 98.00, the opportunity for further strengthening opens up towards 98.25 (50% Fibonacci retracement) and the 100-day moving average. This technical level will be an important confirmation of whether the DXY has bottomed and is ready to resume its rally.
Key Points:
The DXY fell to 97.75, a correction from a two-week high of 98.00.
Expectations of a Fed rate cut are putting pressure on the dollar.
Powell is cautious about limiting aggressive selling.
Technical: support at 97.25–97.00, resistance at 98.00–98.25. (ayu)
Source: Newsmaker.id
