Forex Analysis & Reviews: 19.06.2023 - Dollar: Summary and...

19.06.2023 02:55 PM

Dollar: Summary and Near-Term Prospects

The dollar significantly declined at the end of last week. Market participants reacted negatively to the decision of the Federal Reserve to maintain the interest rate level unchanged, although such a decision was expected.

Despite warnings from the Fed's leadership that they are ready to return to a "hawkish" stance if the economic situation demands it, dollar sellers took advantage of the neutral decision regarding the interest rate, leading to a drop in its DXY index below the 101.60 mark. Over the past three trading weeks, the dollar index has lost 2.9% compared to the 11-week high reached at the end of last month at 104.61.

Nevertheless, some short positions on the dollar were closed at the end of last Friday. Despite the decline, inflation is still far from the regulator's target of 2.0%. According to data released at the beginning of last week, the annual CPI figure for May slowed down to 4.0% (compared to 4.9% the previous month), while the core CPI, which excludes the cost of fuel and food, stood at 5.3% (compared to 5.5% the previous month).

Now, market participants monitoring dollar quotes will carefully study the texts of Federal Reserve Chairman Jerome Powell's speeches in Congress scheduled for Wednesday and Thursday (at 14:00 GMT). In addition to Powell, several FOMC representatives will also provide their comments this week. It is expected that all Fed officials, including Powell himself, may signal the possibility of another interest rate hike as early as July. Currently, the market expects two more rate hikes by the end of this year.

The Fed confirmed that inflation remains elevated and needs to be brought back to the target level of 2%. The summary of economic forecasts raised the projection for the end-of-2023 target rate to 5.6% (from the previous forecast of 5.1% in March), and the forecast for the end of 2024 to 4.6% from 4.3% previously. In other words, Fed officials consider it reasonable to make two more interest rate hikes this year and expect higher GDP growth rates in 2023, a reduction in the unemployment rate, and less progress in core inflation than they anticipated in March.

Commenting on the monetary policy outlook after the Fed's decision, Fed Chair Powell reaffirmed the Fed's commitment to a hawkish policy and further interest rate increases. "Almost all policymakers in the Fed consider it appropriate to continue raising rates this year," Powell said.

Today, there are no important macroeconomic statistics scheduled for release, and it is a national holiday in the United States—Juneteenth. As a result, trading volumes and investor activity will be minimal.

However, in the thin market, dollar buyers may launch an offensive.

Therefore, we anticipate entering long positions on the dollar in all major dollar currency pairs. Stop orders should be placed above/below today's intraday highs/lows.

As for the dollar index, from a technical perspective, the DXY index (CFD #USDX in the MT4 terminal) continues to decline within a downward channel on the weekly chart after breaking through the key medium-term support level at 103.70 (200 EMA on the daily chart), moving towards the key long-term support levels at 100.60 (144 EMA on the weekly chart) and 100.00. A breakout of the key support level at 99.45 (200 EMA and lower boundary of the downward channel on the weekly chart) would indicate a break in the long-term bullish trend of the DXY.

It is also worth noting that the dollar is receiving support today from the resumption of rising yields on U.S. government bonds. One of the reasons for this is the expectation of further tightening of credit and monetary policy by the Fed.

However, to resume medium-term long positions on the DXY, we would wait for its breakout into the zone above the levels of 103.70, 104.00, and possibly 104.65 (local high and 200 EMA on the daily chart at the end of February).

At the same time, a breakout of the local support level at 102.00 could serve as a signal to increase short positions.

Support levels: 102.00, 101.50, 101.00, 100.60, 100.00, 99.45, 99.00

Resistance levels: 102.43, 103.00, 103.10, 103.50, 103.70, 104.00, 104.65, 105.00, 105.85, 106.00, 107.00, 107.80

Bạn đã thích bài đăng này hôm nay

*Phân tích thị trường được đăng tải ở đây có nghĩa là để gia tăng nhận thức của bạn, nhưng không đưa ra các chỉ dẫn để thực hiện một giao dịch.

If you have any content questions, please contact editorial-board@instaforex.com

Fundamental analysis

Jurij Tolin,
Chuyên gia phân tích của InstaForex
© 2007-2025

Thêm các bài viết của tác giả này

E-mail subscription

EURUSD

Euro vs US Dollar

Chọn khung thời gian

phút

giờ

ngày

tuần

Bắt đầu giao dịch

Kiếm lợi nhuận từ những biến đổi giá của tiền điện tử với InstaForex.

Tải MetaTrader 4 và mở giao dịch đầu tiên của bạn.

Các bài báo được đề xuất

Lạm phát ở Canada vẫn còn quá cao – USD/CAD có thể tăng tốc đà suy giảm của mình

XAU/USD. Phân tích và Dự báo

Dữ liệu Chỉ số PCE không có khả năng ảnh hưởng mạnh đến động thái thị trường (Khả năng tăng trưởng trở lại của EUR/USD và Bitcoin)

Thị Trường Đã Thoát Khỏi Sự Kiểm Soát

Những sự kiện nào cần chú ý vào ngày 27 tháng 6? Phân tích sự kiện cơ bản dành cho người mới bắt đầu

Tổng Quan Về GBP/USD – Ngày 27 Tháng 6: Lịch Sử Không Lặp Lại

Tổng quan EUR/USD – Ngày 27 tháng 6: Liệu Trump có thể cân bằng thâm hụt thương mại?

Powell, Trump, và Tất Cả Mọi Người Khác

AUD/USD. Ngưỡng kháng cự 0.6600 trên đường chân trời

Đồng Kiwi Tăng Nhờ Sự Suy Yếu của Đồng Đô La và Khả Năng Ngân Hàng Dự Trữ New Zealand Tạm Ngừng Cắt Giảm Lãi Suất

Các phân tích hàng đầu