Technical charts highlight USD indecision now
The US Dollar Index (DXY) hovered around the 100.18 level but failed to register significant upward momentum. Uncertainty over the outcome of the December Federal Reserve meeting continues to weigh on sentiment. FX analysts at OCBC, Frances Cheung and Christopher Wong, note that rate volatility and Fed signals have left the short-term path of the dollar unclear.
Overnight, support from Waller and Daly for a December rate cut helped push the probability of a cut back to 77%. Despite these swings, the cumulative quantum of cuts projected through end-2026 has remained relatively steady at around 90 basis points.
Meanwhile, the “noise” from Fed commentary (Fedspeaks) is expected to diminish, as no further speeches are scheduled this week and official communications from the Federal Reserve will enter a blackout period starting Saturday.
From a technical perspective, the “spinning top” candlestick pattern signals market indecision and some weakness in the recent USD rebound, likely in anticipation of new catalysts. Two-way trading is expected to persist in the near term.
Key support levels include:
99.50–99.70 (21-day moving average and 61.8% Fibonacci retracement)
99.10 (50% Fibonacci retracement from May high to September low)
The key resistance level stands at 100.60 (76.4% Fibonacci retracement).
The United States Dollar remains volatile ahead of the crucial December Federal Reserve meeting. While some officials support a rate cut, markets await final confirmation and fresh catalysts. Technical signals highlight short-term uncertainty, with traders closely watching critical support and resistance levels.