U.S. Dollar Index is trading down 0.22% at 108.10
The U.S. dollar pushed higher in early European trade Friday ahead of Federal Reserve Chair Jerome Powell’s eagerly-awaited speech at the central bank’s Jackson Hole gathering, which could provide more clues on future policy tightening.
At 03:10 ET (07:10 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.2% higher to 108.623, just below its highest level in two decades and on track for a 0.4% weekly gain.
Traders will focus on Powell’s speech, at 10:00 ET (14:00 GMT), for any insight into how aggressively the Fed still plans to raise interest rates in order to curb inflation running at 40-year highs.
A series of Fed policymakers have in recent weeks been keen to emphasize the importance of the U.S. central bank getting inflation under control.
St. Louis Federal Reserve President James Bullard was the latest on Thursday, saying he expects high inflation to be more persistent than many have been expecting and interest rates now are not yet high enough to begin curtailing price pressures.
This tends to suggest that Powell will retain a hawkish stance, likely pointing to another hike of 75 basis points in September, which can only benefit the dollar further.
On technical fronts U.S. Dollar Index RSI stood at 61.02 and currently it is trading above 10 and 20 days MA & below 5 days MA. So, BUY position can be taken with following target and stoploss: