Fed Turns Up The HawkUSD bulls were not left disappointed by last night’s FOMC meeting. The Fed satisfied hawkish expectations, noting that “it will soon be appropriate to raise the target range for the federal funds rate”. With tapering of QE due to end by early March, the market expects the Fed to lift rates at that month’s meeting with Powell himself noting during the post-meeting presser that members are “of a mind to do so”.The greenback was firmly bid in response to the meeting with the Market now fully pricing in a March hike and upside risks starting to grow. The Fed is currently projecting four hikes this year though some players already suspect it might end up being as many as six. With this in mind, incoming data will be key to mapping the USD move over coming months. If the December/January omicron dip proves to be short-lived, this should keep USD upside intact near-term.Technical ViewsDXYThe Dollar Index is currently tracking the second scenario mapped out. The breakdown below the consolidation block between 95.83 -97.08 saw price trading lower to test the bull channel low and structural support at the 94.63 level. This region saw strong demand with price subsequently turning higher and now fast approaching a test of the 97.08 highs. A break here will put focus on 97.90 next.
Source: Tickmill
