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- The DXY Index retreats after recent US data but still holds onto weekly gains
- December NFPs and Average Hourly Earnings beat expectations, but the Services ISM PMI disappointed
- US Dollar (USD) trading just above 102.40, experiencing slight losses as markets adjust dovish bets following NFP and ISM PMI releases
The US Dollar (USD) is currently trading just above 102.40 with slight losses as markets adjust dovish bets post the release of December’s Nonfarm Payrolls (NFP) and the ISM PMIs.
In the last 2023 Federal Reserve meeting, a dovish stance was apparent, projecting no rate hikes until 2024. Market predictions hint towards a rate cut in March followed by another in May, signaling a bearish climate for the US Dollar.
The ISM Services PMI for December came in at 50.6, missing the consensus of 52.6, contributing to the downward pressure on the US Dollar.
Despite strong labor figures, markets seem to be weighing in more poor ISM figures and rushed to bet on a less aggressive Fed.
The Relative Strength Index (RSI) is charting a negative slope in the negative territory, suggesting a bearish trend prevalent in the DXY. Selling momentum seems to have a stronger hold, reflecting the downward drift of the RSI.
The Moving Average Convergence Divergence (MACD) is showing rising red bars, implying that negative momentum is gradually escalating, further reinforcing the bearish outlook.
In conclusion, the indicators on the daily chart reflect a dominant bearish force in the short term, amplified by the repeated indication of the bulls losing ground and failing to hold the traction gained in the last session.