The US dollar rose for a second session on Wednesday, reaching its highest level in almost a month as markets adjusted to a more hawkish Federal Reserve outlook. October US inflation came in hotter than expected, reinforcing expectations for a December hike and shifting pricing towards a 50 basis-point move rather than 25 basis points, which helped propel the greenback higher.
Technical Analysis and Momentum
Technically, momentum firmed after the Dollar Index pushed above the 10- and 20-day moving averages, which formed a bull-cross, and broke through the upper boundary of a bear channel. That move lifted price beyond the 76.4% Fibonacci retracement of the 102.72/101.03 decline, while last week’s double bear-trap around 101.99—aligned with the 38.2% Fibonacci level of the 96.44/102.72 leg—continues to underpin the advance. Resistance is seen at 102.40, then 102.72, a break of which would expose 103.00 and 103.37, with further targets at 104.15/40 tied to the 28 March 2025 high and the 61.8% retracement; support sits at 102.07, 101.90, 101.68 and 101.30, with the 102 area viewed as a potential dip buffer.
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