The US Dollar Index (DXY) is struggling to regain the 99.00 level, facing pressure after a 1.5% depreciation over the past two weeks. The Index remains flat around this key level after recovering from lows of 98.80, with market players cautious ahead of the Federal Reserve’s upcoming policy meeting.<\/p>\n
The US Personal Consumption Expenditures data will be released soon, expected to reveal continued price pressures. Despite these figures, the possibility of further interest rate cuts remains as the labour market continues to struggle. Attention is focused on future implications beyond the immediate data.<\/p>\n
On a technical level, the US Dollar Index is positioned below the neckline of a Double Top Pattern at 99.00. This pattern may suggest a potential deeper correction from the previous rally. A failure to surpass 99.00 could lead to further declines towards support levels of 98.80 and 98.60. Conversely, breaking above 99.00 might pave the way to targets such as December 2 high at 99.55 and potentially the 100.00 level.<\/p>\n
This week, the US Dollar showed varied performance against major currencies, most notably a 1.30% drop against the Swiss Franc. The table presents specific percentage changes in USD value against various currencies, indicating relative market strengths and weaknesses.<\/p>\n
We are watching the US Dollar Index closely as it struggles to stay above the critical 99.00 level. This comes after a significant 1.5% decline over the past two weeks, putting the dollar on shaky ground. The next few sessions will be crucial in determining its direction into the end of the year.<\/p>\n
A failure to reclaim 99.00 confirms a bearish double top pattern, which often signals a major trend reversal. For derivative traders, this setup suggests positioning for a deeper correction in the coming weeks. The measured move from this pattern points towards a potential drop to the 97.60 area, a level we haven’t seen since early October 2025.<\/p>\n
This technical weakness is reinforced by a cooling economy, as we saw with this morning’s jobs report for November 2025 showing only 95,000 new jobs and unemployment rising to 4.2%. These figures fuel expectations that the Federal Reserve will have to cut interest rates next week to support the labor market. Markets are now pricing in an over 80% probability of a rate cut at the upcoming meeting.<\/p>\n
If we see the DXY break below the recent 98.80 low, buying put options or establishing bear put spreads would be a direct way to profit from a move towards 98.00. Selling out-of-the-money call options or using call credit spreads could also be an effective strategy to capitalize on falling prices. This approach allows traders to define their risk while positioning for a weaker dollar.<\/p>\n
On the other hand, a decisive break and hold above 99.00 would invalidate the bearish pattern. Such a move, potentially driven by a surprisingly hawkish Fed statement, would open the path towards 99.55 and even 100.00. In that scenario, traders should be ready to close short positions and consider call options to ride the upward momentum.<\/p>\n
Looking back at recent performance, we saw the dollar show some strength against the Swiss Franc but significant weakness against the Australian Dollar. This divergence highlights that a potential dollar decline may not be uniform across all currency pairs. Traders should focus their short-dollar strategies against currencies with stronger fundamental backdrops.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" US Dollar Index struggles near 99.00, with Fed policy, inflation data, and technical patterns influencing direction.<\/p>\n","protected":false},"author":62,"featured_media":16964,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-36128","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/36128","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=36128"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/36128\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16964"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=36128"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=36128"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=36128"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}