The DXY is expected to drop to near 114.00 amid a weak buying interest while testing the 114.50 hurdle. (Pivot Orderbook analysis)

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• The DXY is expected to drop to near 114.00 amid a weak buying interest while testing the 114.50 hurdle.
• A lower-than-expected decline in the demand for US Durable Goods has supported the DXY.
• Fed Powell’s speech is likely to remain hawkish amid soaring price pressures.

The pair currently trades last at 114.11.

The previous day high was 114.47 while the previous day low was 113.31. The daily 38.2% Fib levels comes at 114.03, expected to provide support. Similarly, the daily 61.8% fib level is at 113.76, expected to provide support.

The US dollar index (DXY) is on the verge of delivering a downside break of the consolidation formed in a narrow range of 114.27-114.10. The DXY is expected to decline towards the round-level support of 114.00 as the asset has failed to sustain above 114.40 after multiple attempts.

The DXY rebounded firmly on Tuesday after a lower-than-expected decline in the US Durable Goods Orders data. The decline in demand for Durable Goods landed at 0.2%, lower than the expectations of a decline of 0.4%. As the Fed is sticking to its path of hiking interest rates, a decline in demand for consumer durables cannot be ruled out. So a lower-than-expected reading cheered the DXY investors.

Crushing the galloping inflation is the foremost priority of the Federal Reserve (Fed). Therefore, investors should brace for a ‘hawkish’ tone from Fed chair Jerome Powell on interest rates. A roadmap of hiking interest rates for the remaining 2022 is expected to be dictated.

Two monetary policy meetings, scheduled in the first week of November and mid of December, will set the path for the 2023 rate cycle. As the Fed sees interest rates top around 4.6%, bigger rate hikes in 2022 will scale down the scope of jumbo rate hikes in 2023. Although, the Fed will keep the rates higher till it finds a slowdown in price pressures for several months.

Technical Levels: Supports and Resistances

EURUSD currently trading at 114.11 at the time of writing. Pair opened at 114.16 and is trading with a change of -0.04 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 110.54, 50 SMA 108.46, 100 SMA @ 106.48 and 200 SMA @ 102.31.

The previous day high was 114.47 while the previous day low was 113.31. The daily 38.2% Fib levels comes at 114.03, expected to provide support. Similarly, the daily 61.8% fib level is at 113.76, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 113.49, 112.82, 112.33
• Pivot resistance is noted at 114.65, 115.14, 115.8

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