US Dollar: Post-FOMC consolidation and data focus – OCBC
OCBC strategist Christopher Wong observes that the US Dollar (USD) has eased modestly as UST yields and Oil retraced from their post-FOMC spikes. He sees the move as consolidation, with further USD gains likely needing another leg higher in UST yields.
U.S. Dollar (USD) experienced a modest decline following the Federal Reserve's post-FOMC consolidation period, as yields and oil prices retraced from their post-FOMC spikes. OCBC strategist Christopher Wong suggests that this consolidation phase may persist until another leg higher in U.S. Treasury yields occurs. Upcoming economic data covering activity, labor markets, and inflation may trigger a reassessment of rate expectations, potentially reopening downside in the Dollar.
DXY reached 100.2, with bullish momentum on a daily basis, though the RSI indicated a tentative shift toward a lower position from near overbought conditions. The resistance levels are at 100.32 (23.6% Fibonacci retracement from the 2026 low to high) and 100.60, while the support levels are at 100/99.80 (50, 100 DMAs), 99.4 (38.2% Fibonacci), and 99.2 (21, 200 DMAs).
Any signs of moderation in activity, labor-market conditions, or inflation could prompt some unwinding of rate expectations and open the door for a downward trend in the USD.
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