United States Dollar Index trades firmly above 100.00 while approaching to weekend
The US Dollar (USD) consolidates in a tight range during the Asian trading session on Friday, but is close to its highest level seen in the last six weeks. At press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades firmly near 100.27.
The US Dollar Index (DXY) is currently trading near 100.27, marking a significant level since the past six weeks. This performance is attributed to the Federal Reserve's recent decision to raise interest rates by 25 basis points, bringing the range to 3.75%-4.00%. The US Dollar has outperformed this week due to the Fed's increased rate hikes and revised interest rate expectations among traders.
The DXY was the strongest against the Japanese Yen during the week. According to the CME FedWatch tool, the likelihood of at least one more interest rate hike from the Fed has risen to 88%, up from 66.3% the previous week. This optimism has been fueled by the hawkish stance of Fed Chairman Kevin Warsh, who emphasized that inflation remains high and has persisted for too long during a recent press conference.
The DXY is trading above the 20-day exponential moving average (EMA) at 99.56, signaling a bullish sentiment in the near term. The 14-period Relative Strength Index (RSI) is near 62, indicating sustained buying pressure without yet reaching overbought territory. On the downside, initial support is seen at the 20-day EMA around 99.56.
If the DXY closes above 100.26, it would further reinforce the bullish bias and focus on continued gains, provided the index remains above the short-term average.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
