Fed officials signal readiness for easing
The US Dollar Index (DXY) slipped modestly yesterday, closing near 98.20. FX analysts at OCBC, Frances Cheung and Christopher Wong, highlighted that bearish momentum remains intact. With the index hovering near oversold conditions, Federal Reserve officials emphasized the need for greater flexibility in monetary policy.
In overnight remarks, Fed official Miran cautioned that labor market deterioration can emerge suddenly and nonlinearly, making recovery difficult. He noted that because monetary policy effects lag several quarters, a quicker pace of easing could appropriately move policy closer to a neutral stance.
Meanwhile, Fed official Williams stated that monetary policy is well positioned for next year following last week’s rate cut, citing heightened employment risks and somewhat reduced inflation pressures.
From a technical perspective, bearish momentum on the daily chart remains intact, while the Relative Strength Index (RSI) is near oversold territory. Short-term consolidation cannot be ruled out.
Key support levels are seen at 98.10 and 97.60, aligning with the 23.6% Fibonacci retracement. On the upside, resistance is located at 98.40–98.60 (100-day moving average and 38.2% Fibonacci), then 99.10–99.30 (21, 50, and 200-day moving averages and 50% retracement from the May high to the September low), and finally 99.80 (61.8% Fibonacci retracement).