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FxWirePro: DXY declines more than 100 pips as Fed doves take flight,good to sell on rallies

DXY has lost more than 100 pips as US Fed is expected to keep interest rate on till Mar 2019. According to CME Fed watch tool shows that probability of Fed to keep rates unchanged is 99.5% for month of Jan, 94.3% for 20th Mar 2019 and 88.7% for May 1st 2019 Fed meeting.The dollar index hits low of 95.62 and is currently trading around 95.74.

 

On the lower side, major support is around 94.99 (300- day EMA) and any break below targets 94.12 (38.2% fib)/93.80.

 

The index has retraced till 61.8% fib around 96.68 and started to decline. The near term resistance is around 96.11--96.25 (55- day EMA and 100-day MA) and any break above will take the index to next level till 96.68. The minor trend reversal only above 96.68.Major bullish continuation only above 97.75.

 

It is good to sell on rallies around 96.25-30 with SL around 96.70 for the TP of 95.

 

 

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