US Dollar Price Forecast: Dollar Holds Near 99.60 as Traders Await Fed Signals – GBP/USD and EUR/USD

Market Overview

During the European session, the US Dollar Index (DXY) halted its decline but failed to gain traction, trading around 99.70. Despite the Senate’s resolution to end the US government shutdown that began on October 1, the Greenback remains under pressure.

Investors are cautious as delayed economic data and concerns about the shutdown’s long-term effects weigh on sentiment.

Shutdown Resolution Fails to Lift the Greenback

While the Senate compromise ended the longest shutdown in US history, it hasn’t sparked fresh demand for the dollar. Traders are avoiding large bullish positions until key data reveals how the economy has absorbed the disruption. With US banks closed Tuesday for Veterans Day, trading volumes are expected to stay light, limiting volatility in the currency.

Weak Consumer Sentiment and Fed Cut Bets Pressure the Dollar

The University of Michigan’s Consumer Sentiment Index dropped to 50.3 in November, its lowest since June 2022, reflecting waning confidence in the economy.

Meanwhile, markets are pricing a 60% chance of a Federal Reserve rate cut in December, according to the CME FedWatch Tool. This dovish outlook continues to cap the dollar’s upside.

Outlook

The Greenback’s near-term path remains cautious. While the shutdown’s end removes one uncertainty, soft consumer data and rate cut expectations keep upside momentum limited.

US Dollar Index (DXY) – Technical Analysis

The U.S. Dollar Index (DXY) is consolidating near 99.70 after rebounding from the 99.25 support zone, maintaining a short-term bullish bias. The 4-hour chart shows price action respecting the ascending trendline, with buyers defending higher lows.

The 20-EMA is flattening, while the 200-EMA remains supportive near 99.00. A sustained move above 99.80 could encourage a test of the 100.35–100.65 area, aligning with the 23.6% Fibonacci retracement zone. RSI readings around 50 suggest neutral momentum, but improving structure points toward gradual recovery.

GBP/USD Technical Analysis

GBP/USD trades near $1.3122, pulling back after failing to sustain above the descending trendline resistance at $1.3174. The pair remains capped below the 200-EMA, suggesting sellers still dominate the broader trend.

The RSI has turned lower from the 60 zone, showing fading bullish momentum after last week’s rebound. If price slips below $1.3075, further downside could expose $1.3010, a key support area aligned with late October lows.

However, a breakout above $1.3175 would invalidate the bearish bias and open a path toward $1.3245 and $1.3320.

EUR/USD Technical Forecast

EUR/USD is trading near $1.1559, struggling to break above the $1.1580 resistance and a descending trendline that has capped gains since mid-October. The pair remains below both the 50-EMA and 200-EMA, suggesting the broader bias still leans bearish.

The RSI sits near 55, showing mild upward momentum but lacking strong conviction from buyers. If the pair clears $1.1580, a move toward $1.1630–$1.1675 could follow. However, failure to hold above $1.1530 would likely lead to a retest of $1.1470, a key support from early November.