US DOLLAR INDEX

[Yousuf Ali]

U.S. Dollar index has broken major trend line resistance at 101.27 and jumped slightly from that level. It is currently trading around 101.47.

On the higher side, any close above 101.27 will take the index till 101.73 and then 102.06

The major support is around 100.64 and any break below targets 100.

Short term bullish invalidation only below 98.

[Yousuf Ali]

WHAT'S IMPORTANT ABOUT FEDERAL RESERVE’S MONETARY POLICY MEETING?

With a pre-set regularity, a nation's Central Bank has an economic policy meeting, in which board members took different measures, the most relevant one, is the interest rate that it will charge on loans and advances to commercial banks. In the US, the Board of Governors of the Federal Reserve meets at intervals of five to eight weeks, in which they announce their latest decisions. A rate hike tends to boost the local currency, as it is understood as a sign of a healthy inflation. A rate cut, on the other hand, is seen as a sign of economic and inflationary woes and, therefore, tends to weaken the local currency. If rates remain unchanged, attention and also main news and analysis turn to the tone of the FOMC statement, and whether the tone is hawkish, or dovish over future developments of inflation.