Forex Analysis & Reviews: 16.11.2022 - DXY: waiting for a signal....

16.11.2022 11:00 AM

DXY: waiting for a signal. To buy?

Despite the fact that the dynamics of the dollar did not have a clear direction during today's Asian trading session, and the dollar quotes were in a narrow range, it still remains under pressure.

As you know, inflation indicators for the US were published last week, indicating a slowdown in inflation in the country. Consumer price index (CPI) fell in October from 8.2% to 7.7% (year on year), stronger than the forecast of a decline to 8.0%. The core value (Core CPI) corrected from 6.6% to 6.3% against the forecast of 6.5% (also year on year).

The data signal that the Fed's efforts to contain inflation in the US are yielding some results and the pace of policy tightening may soon be slowed down.

Last Monday, Fed Vice Chair Lael Brainard noted that such changes in the approach to determining the necessary parameters of monetary policy are quite appropriate. At the same time, she noted that inflation is still too high and there is still a lot of work to be done to bring it back to the target level of 2.0%.

A little earlier, Fed Governor Christopher Waller expressed similar thoughts, admitting the possibility of slowing the pace of interest rate hikes. Yesterday, producer price indices in the United States for October were published, which also showed a slowdown: on a monthly basis, the indicator remained at the same level of 0.2% instead of the expected growth to 0.4%, and on an annual basis it adjusted from 8.4% to 8.0%.

Thus, the probability of a Fed rate hike by 75 basis points in December decreased. On the contrary, now market participants, according to the CME Group, put in prices an 80% probability of an increase in the Fed's interest rate in December by 50 bps.

In one of our previous reviews, we assumed that if the publication of US inflation data disappoints investors, it will provoke a new wave of dollar sell-offs and a drop in DXY towards 109.00.

At that time, DXY futures were trading near 110.46, maintaining a negative momentum and moving in the lower part of the descending channel that formed last month (on the DXY chart).

A break of these levels could trigger deeper DXY, up to key support levels at 107.40, 105.65. As a matter of fact, this happened: the price broke through the lower border of the descending channel on the DXY chart at 109.00 and reached the local low of 105.15 in the next three days, and yet, above the key support level of 105.65 (200 EMA on the daily CFD #USDX chart), the dollar index remains in long-term bull market zone.

Long positions in DXY will again become preferable when there are signals to buy. Now the first such signal will be the return of the price to the zone above the resistance level 107.40 (144 EMA on the daily CFD #USDX chart), and the confirming one will be the growth above the levels of 109.00, 110.00.

Today, market participants who follow the dynamics of the dollar, will study the report of the US Census Bureau on retail sales.

Consumer spending accounts for most of the total economic activity of the population, while domestic trade accounts for the largest part of GDP growth. A relative decrease in the indicator may have a short-term negative impact on the dollar, and an increase in the indicator will have a positive impact on the USD. The indicator is expected to grow (+1.0% in October against the previous monthly values 0%, +0,3%, 0%, +0,8%, -0,1%), which should, theoretically, support the dollar.

你今天已经点赞上这篇文章了

*这里的市场分析是为了增加您对市场的了解，而不是给出交易的指示。

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

Fundamental analysis

Jurij Tolin,
Analytical expert of InstaForex
© 2007-2025

该作者的更多文章

电子邮件订阅

EURUSD

Euro vs US Dollar

选择时间框架

分钟

小时

天

周

开始交易

通过InstaForex赚取加密货币汇率变动的收益。

下载MetaTrader 4并开启您的第一笔交易。

推荐文章

XAU/USD。分析與預測

市場已無路可逃

美元上漲——原因在此

為何黃金價格可能大幅下跌？（黃金價格可能會持續走低，而NASDAQ 100 指數期貨的差價合約可能上漲）

英鎊/美元概況 – 4月25日：聯儲會開始真正擔憂

歐元/美元概述 – 4月25日: 美國對特朗普提起訴訟

4月25日需要關注什麼？初學者必看的基本事件解析

日圓呈現越來越強勁的走勢

加拿大靜待大選結果。美元/加幣展望

若美中貿易戰升級，澳大利亞元或將受到影響