Fed Pressures the USD Index
The dollar index is under pressure today giving up 0.42 percent to 96.82 approaching multi month low, after yesterday, FED left interest rates unchanged as widely expected by markets but changed its language to more dovish amid growing global trade fears. Investors now expect that the U.S. central bank is moving to an interest rate cut sooner than anticipated, and some analysts forecasting three rate cuts by the end of the year.
The 96.47 mark the low from June 7 will provide first support while more bids will emerge at 95.75 the low from March 20. Now bears are in the drivers seat after the greenback broke below the 100 day moving average. The dollar index will face the first resistance at 97.05 the 100 day moving average that has turned into resistance, while more offers will emerge at the 97.45 the 50 day moving average. All in all, the outlook for USD dollar index now has turned bearish as interest rate cuts are ahead from The Fed.