Fxwirepro: US Dollar index Daily Outlook

Major support- 98.20 (21-day MA)

US dollar index continues to trade lower on mixed US Non-farm payroll.US economy has added 136000 jobs in Sep compared to forecast of 145000 and the unemployment rate around 3.5%.

The weak economic data in the previous week has increased hopes of rate cut by the Fed in the next meeting.US 10-year yield continues to trade lower and lost more than 20%. The spread has widened sharply by 12 bps from 2 bps.

According to the CME Fed watch tool, the chance of keeping rates unchanged declined to 21.4% from 60% 1-week ago and the probability of 25 bps cut jumped to 78.6% from 39.6%.

The near term resistance is around 99.20 and any break above targets 199.60/100/100.30.

On the flip side, near term support is around 98.60 and any break below will drag the DXY to level 98.40/98. Major weakness only below 98 levels.

It is good to sell on rallies around 98.95-99 with SL around 99.25 for the TP of 98.20.