DXY: Await presidential inauguration – OCBC
Source Fxstreet
US Dollar (USD) started the week on a slightly softer footing ahead of US holiday (Martin L. King Day) and Presidential inauguration today. Trump had promised to sign a host of executive orders on his 1st day as President. DXY was last at 108.48 levels.
Consolidation likely for now
"At a preinauguration rally hours ago, he told the crowd he “will act with historic speed and strength and fix every single crisis”. Trump promised executive orders that will ramp up artificial intelligence, form the Department of Government Efficiency (DOGE), etc. Media reports indicated Trump may issue more than 200 executive actions on Monday. There remains quite a fair bit of expectations that tariffs may soon be announced."
"But we believe tariff uncertainty remains in terms of timing, magnitude and scope of products. A longer delay for tariff announcement may provide a breather for risk proxies, and we do not rule out USD pullback (lower). That said, a swift order for tariff implementation is likely to undermine sentiments and provide a boost to the USD. Last Friday, President-elect Trump and President Xi had a phone call to discuss trade, TikTok and fentanyl."
"Trump said that that the call was a very good one for both China and the US. Separately over the weekend, Gaza ceasefire took effect. Daily momentum is mild bearish but decline in RSI moderated. Consolidation likely for now as we await event risk (signing of executive orders/ actions). Support at 108.75 (21 DMA), 107.43 (50DMA). Resistance at 110.10, 110.90 levels."
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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