The US Dollar Index (DXY), which measures the buck vs. a basket of its main competitors, is slowly edging higher to 2-day peaks in the 95.80/85 band.
January 30, GKFX – The index has regained some composure following a negative start of the week and is now advancing for the second session in a row, looking to test the vicinity of the key barrier at 96.00 the figure.
US Dollar Index looks to FOMC
The demand for the greenback has been gathering traction in past hours as market participants get ready for the upcoming FOMC event, while the absence of significant headlines in the risk-associated universe and rising uncertainty around Brexit following yesterday vote in the UK Parliament have also collaborated with the bid mood surrounding the buck.
Looking ahead, the Federal Reserve is expected to leave its monetary conditions unchanged at today’s meeting. However, attention will be on the press conference by Chief Powell and views on the potential re-assessment of the rate path this year.
What to look for around USD
The FOMC meeting will be the salient event today. While rates are expected to remain unchanged, markets’ focus will be on potential changes (if any at all) to the Fed’s forward guidance for the current year.
In addition, and following recent news, investors will look for any hints on the (renewed?) stance on the balance sheet. In addition, US-China trade talks are set to resume today, although speculations on a probable deal have somewhat deflated as of late.
US Dollar Index technical analysis
At the moment, the pair is down 0.03% at 95.78 and a break below 95.62 (low Jan.29) would aim for 95.30 (61.8% Fibo of the September-December up move) and then 95.30 (200-day SMA).
On the other hand, the next hurdle aligns at 95.98 (21-day SMA) seconded by 96.22 (38.2% Fibo of the September-December up move) and finally 96.50 (55-day SMA).
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