Insights 
VT 
The US Dollar (USD) is consolidating near a 5-day high, yet its movement remains subdued. The DXY index is around the 99 mark, according to analysts at OCBC.
Geopolitical tensions continue to restrain risk sentiments. The US is contemplating restricting exports to China that involve US software, while changes in use of long-range missiles by Ukraine have been authorised.
USD Resistance and Support Levels
US Treasury Secretary mentioned impending sanctions on Russia, while a downturn in precious metals influences sentiments. In the short term, DXY may persist near the upper range, with signs of a mild bullish trend. The resistance levels for DXY are at 99.10, 99.80, and 100.80, while support is identified at 98.40, 98, and 97.60.
The export restrictions and tensions impact EUR/USD, GBP/USD, and precious metals, while also influencing GBP/JPY as a result of yen weakness. Additional related market events include US CPI release on Friday and the Swiss National Bank’s minutes, with minor insights into the negative rate debate.
From our perspective, the US Dollar is showing signs of strength but lacks a clear reason to break out of its current range. We should be looking at two-way trades for the coming weeks, as the DXY seems comfortable around the 99.00 level. This indecision presents opportunities for traders who are not betting on a single direction.
We see these geopolitical tensions reflected in the market’s fear gauge, with the VIX index recently creeping up from 15 to over 19 in October 2025. This growing uncertainty provides a base level of support for the dollar as a safe-haven asset. However, recent Q3 data showing a 3% slowdown in US export growth suggests the strong dollar may be starting to bite, capping the upside for now.
Market Reactions and Strategies
Given this sideways price action, derivative plays that profit from the dollar staying within a defined channel appear prudent. We could consider strategies like selling strangles on USD futures, positioning outside the key support at 98.40 and resistance near 99.80. This allows us to collect premium while the market waits for a more significant catalyst.
The upcoming Consumer Price Index (CPI) release is the primary event that could break this pattern. We all remember how the inflation shocks of 2022-2023 caused massive swings, and the market remains highly sensitive to any signs of persistent price pressures. A higher-than-expected inflation number would almost certainly send the dollar pushing towards the 100.80 level.
The recent weakness in precious metals, with gold falling back toward $2,200 an ounce despite global tensions, also tells a story. This suggests the market is more focused on the dollar’s yield than on traditional safe havens. It reinforces the view that any hawkish inflation data will likely fuel further dollar strength at the expense of other assets.
