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Dollar eases near 99.6 as NFP week turns focus to Fed timing

The DXY was down 0.1% near 99.58 after Fed remarks at Jackson Hole pushed September hike odds lower to 39.4% from about 60% a week earlier.

Reported · Written up by our desk · Major Pairs

The US Dollar Index, DXY, slipped in Asian trading at the start of the Nonfarm Payrolls week, falling about 0.1% to near 99.58 after a strong Friday, according to FXStreet.

FXStreet attributed the prior dollar strength to remarks from Federal Reserve Chairman Kevin Warsh at the Jackson Hole Symposium that signaled the Fed remains committed to bringing inflation back toward its 2% target, which boosted expectations for a September rate hike. Using the CME FedWatch tool, FXStreet said odds of the Fed holding rates steady in September fell to 39.4% from almost 60% a week earlier.

This week, FXStreet noted investors will focus on a calendar of US data led by Nonfarm Payrolls on Friday, which is expected to move Fed interest rate expectations.

On the technical side, FXStreet said the DXY is trading around 99.60, holding marginally above the 20-day exponential moving average at 99.55 but capped by the 50.0% Fibonacci retracement at 99.73, with RSI near 48.3 indicating fading upside momentum as the index consolidates. FXStreet also flagged resistance levels at 99.73, 100.22 and 100.83, and support at 99.55 with deeper cushions near 99.24 and 98.54 ahead of a structural floor around 97.65.

Latest closeDollar index 99.68 ▲0.5%

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