The dollar index is close to testing the 109 again as EURUSD fell below parity. This week, a hawkish presence is expected from the FED members, especially from Powell at the Jackson Hole. Last week, FED members basically said that the rate will stay higher longer than the markets expected. The markets are pricing FED to cut rates after the first quarter of 2023. Powell might want to address that to keep inflation expectations in check.
If the dollar index breaks the 109 resistance, the uptrend will continue. The trend channel’s upper line can be the next target for the bullish dollar. However, a dovish than expected Powell might cause a flat exit from the uptrend in a 104.50 – 109 zone, later this week.
