Major Trend line resistance- 99.60 (major trend joining 95.15 and 96.98)
US dollar index has halted its 2-week of bullish trend and trading weak for 3rd consecutive days. US ADP employment data shows that private-sector jobs have added 135000 in Sep compared to a forecast of 152000. The Aug estimate of new jobs reduced to 157000 from 195000. US 10-year yield continues to trade lower and spread has widened sharply by 10 bps from 2 bps.
According to the CME Fed watch tool, the chance of keeping rates unchanged declined to 24.8% from 50.8% 1-week ago and the probability of 25 bps cut jumped to 77.2% from 49.2%.
The near term resistance is around 99.60 and any break above targets 100/100.30. Markets eye US ISM services for further direction.
On the flip side, near term support is around 98.990 and any break below will drag the DXY to level 98.65/98.40. Major weakness only below 98 levels.
It is good to sell on rallies around 99-99.05 with SL around 99.25 for the TP of 98.20.
