The USD Awaits the FOMC
Rowan Crosby • 1 min read
The USD appeared to find a bit of a bid late last week after a stronger than anticipated jobs report helped lift the Greenback.
Since testing the highs earlier in the week, the USD has really fallen away. It came on the back of some weak data points and the fact that it was arguably already a little overextended.
Then the US employment report came in showing well over the 200K jobs that were anticipated and that seemed to spark some buying interest.
At the same time, US President Trump continues to be bullish on the China-US trade situation so that will be another factor to watch this week.
The big headline act for the USD will again be the FOMC. We are not expected to see a hike as the scheduled rate increases were set for September and December. The bullish language we saw from the minutes last month did add the USD pushing higher, so what the statement has to say on the outlook for 2019, could well make or break the USD this week.
And of course, the outcome of the US midterm elections will clearly be important. More on that later today.
The USD Outlook
The DXY tried to and crack the major resistance level at 97.00 mid last week and ultimately failed.
Since then price pulled back to support and 96.20, but it pushed through to the 96.00 mark on the dot before bouncing.
I’m still expecting to see this support level hold for now and for the DXY to retest the 97.00 mark.
I think price just ran up too steeply. Depending on what the FOMC statement has to say on 2019 and beyond, might just dictate how far price can run this year.