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James Hyerczyk
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The U.S. Dollar is trading at its highest level against a basket of major currencies since April 19 on Thursday after the Federal Reserve brought forward its projections for the first post-pandemic interest rate hikes into 2023, citing an improved health situation and dropping a long-standing reference that the crisis was weighing on the economy.

At 01:45 GMT, September U.S. Dollar Index futures are trading 91.380, up 0.172 or +0.19%.

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A majority of 11 Fed officials penciled in at least two quarter-point interest rate increases for 2023, even as officials in their statement pledged to keep policy supportive for now to encourage an ongoing jobs recovery.

Daily September U.S. Dollar Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier in the session when buyers took out the May 5 main top at 91.410. A trade through 89.795 will change the main trend to down.

The minor trend is also up. A trade through 90.310 will change the minor trend to down. This will shift momentum to the downside.

The new minor range is 89.545 to 91.470. Its retracement zone at 90.510 to 90.280 is the nearest support. This zone will move up as the index moves higher.

The short-term range is 93.430 to 89.545. Its retracement zone at 91.490 to 91.950 is the next upside target.

The major retracement zone at 91.850 to 92.495 is the primary upside target.

The key area to watch today is the resistance cluster at 91.490 to 91.495.

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Daily Swing Chart Technical Forecast

The direction of the September U.S. Dollar Index on Thursday is likely to be determined by trader reaction to 91.490 to 91.495.

Bullish Scenario

A sustained move over 91.500 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for the rally to extend into the major 50% level at 91.850. Sellers could come in on the first test of this level. Taking it out could trigger an acceleration to the upside with 92.495 a near-term target.

Bearish Scenario

A sustained move under 91.480 will signal the presence of sellers. This won’t change the trend, but it could trigger a short-term break with the next potential downside target the minor retracement zone at 90.510 to 90.280.

For a look at all of today’s economic events, check out our economic calendar.
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