U.S. Dollar Index Analysis (USD Index – DXY) – Latest Trends and Expectations?

Key news on the US dollar on today’s economic agenda:

• GDP (quarterly) was higher than expected at 4.4%.
• The number of people filing for unemployment benefits was 20,000, lower than expected.
• The core PCE price index (month-on-month) (November) is expected to be around 0.2%.
• Core PCE price index (year-on-year) (November) is expected to be around 2.8%.

Technically, after the breakout and recovery, trading remained within the 97.685-98.775 level range, indicating that the forces of supply and demand continue to be balanced. Based on these moves so far, here’s what could happen in the upcoming trade:

• Casual scene:
  If the trend continues within the horizontal range of approximately 97.685 – 98.775, we will see more sideways movement to express the continued uncertainty and balance between the forces of supply and demand.
• Positive scenario:
  Another rise and hold above 98.775 could indicate a return to buying control on the demand side and we may see further gains, possibly targeting higher levels around 100 – 100.463.
• Negative scenario:
  Further declines, below and holding near 97.685, may indicate that the supply side will be under selling control in the short term, and we may target lower levels near 97.059.

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