![Forex Trading | Is Dollar index ready to give 1.5-2% movement?](https://commoditysamachar.com/wp-content/uploads/2023/11/BLOG-2023-11-03T171740.833-1024x576.webp)
The US Dollar continued to weaken against its major counterparts for the third consecutive day in the latest forex trading session. The currency reacted negatively following mixed economic data releases from the US yesterday. However, downside remains capped ahead of the release of key nonfarm payrolls data later in the session.
Dollar Index, which tracks the greenback against a basket of six other currencies, traded at 106.064 down 0.09%.
On Wednesday, Fed policy makers kept the policy rate steady in its current 5.25%-5.50% range, as widely expected. The US Dollar, however, succumbed to the sell-off in the US Treasury bond yields after Fed Chair Jerome Powell remained non-committal on the need for further tightening.
Although Powell did not rule out another hike, markets perceived his words as not-so hawkish as they expected. Powell acknowledged tighter financial conditions while adding that taming inflation will most likely require a slowdown in growth and dampening in the labor market.
The data from the US showed the weekly Initial Jobless Claims rose to 217,000 from 212,000. On a positive note, Factory Orders increased by 2.8% on a monthly basis in September. The benchmark 10-year US Treasury bond yield fell more than 1% and dropped below 4.7%, putting additional weight on the USD shoulders.
Adding to this, the Bureau of Labor Statistics (BLS) is due to release the significant Nonfarm Payrolls report later today, which could have major consequences for US Federal Reserve policy outlook. The US Dollar is poised for a big reaction to the labor market data, as NFP data tends to infuse intense volatility as per the forex trading reports.
Today, Nonfarm Payrolls data is foreseen at 178K from the previous month’s 336k. The Unemployment Rate is expected to hold steady at 3.8% in the reported month.
Forex Trading | Technical Outlook:
![](https://commoditysamachar.com/wp-content/uploads/2023/11/DXY_2023-11-03_14-36-59.png)
Dollar index retreated from 11 month high 107.113 and made a low 105.812 yesterday. Now traded at 106.130 almost flat.
On the above chart, since 6 October 2023, it has been consolidating in between the range of 107.10-105.50 and forming an ascending triangle pattern. Which is indicating a big move is waiting in days to come.
However, the pattern is not completed, but it’s expected that either side break will give 1.5%-2% percent abrupt move. On the downside, crucial support is seen at 105.5025, coinciding with the lower trend line of the pattern and a break below its dollar index could test 104.8550-104.2550 very soon.
Alternatively, it may rebound from the support of 105.80-105.55 again. And could jump towards 106.8050-107.2550 on the upside.
Commodity Samachar
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