Above 102.00: US Dollar Index Price Forecast as DXY Hovers Near Two-Week High Ahead of FOMC

Near two-week highs prove difficult to build on as DXY struggles to extend Wednesday's modest intraday advance.
Ahead of the key two-day FOMC meeting's conclusion, bulls trim positions and await the outcome.
A favourable technical backdrop points to further gains as the more likely direction.

The US Dollar Index (DXY) is trading around 102.35, almost flat on the day. Tracking the Greenback against a basket of currencies, the index has retreated from the nearly two-week high reached earlier on Wednesday. Bulls have adopted a cautious stance before the crucial FOMC decision, although the pullback has yet to gather momentum.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

With the US Federal Reserve (Fed) widely expected to leave interest rates on hold after its two-day meeting, attention is set to centre on the policy statement and Chairman Kevin Warsh's press conference. Investors will seek clearer signals on the Fed's policy outlook. Those signals should give DXY fresh direction before Thursday's major US economic releases: the Advance Q3 GDP report and the Personal Consumption Expenditures (PCE) Price Index.

The recent break above the 50-period Simple Moving Average (SMA) on the 4-hour chart, alongside a move through the mid-range Fibonacci retracement levels, keeps the technical outlook favourable for DXY. However, the failure to build momentum above the 61.8% Fibonacci retracement calls for caution before bulls position for additional gains. Oscillators on the same chart also indicate that bullish momentum remains solid but is becoming increasingly stretched.

Should the retreat extend, the first support could emerge at 102.20, the 50% Fibonacci retracement. Below that sit the 38.2% retracement at 102.02 and the 50-period SMA at 101.88. A steeper decline would bring the 23.6% level at 101.81 into view, followed by the structural support floor around 101.45. Conversely, a renewed advance above the 61.8% retracement at 102.38 could meet immediate resistance around 102.63, the 78.6% level, while additional resistance is concentrated around the previous swing high near 102.95.

(An AI tool assisted in preparing the technical analysis in this article. Learn more.)

4-hour DXY chart

Economic Data Release

Fed Interest Rate Announcement

At eight scheduled meetings each year, the Federal Reserve (Fed) reviews monetary policy and decides on interest rates. Its dual mandate is to maintain full employment and keep inflation at 2%. To pursue these goals, it primarily sets the rates at which it lends to banks and at which banks lend to one another. A rate increase tends to support the US Dollar (USD) by drawing in more foreign capital. A reduction generally weakens the USD as capital moves to countries offering higher returns. When rates stay unchanged, the focus shifts to the Federal Open Market Committee (FOMC) statement's tone: hawkish signals point to expectations of higher future interest rates, while dovish signals indicate expectations of lower rates.

Next publication: Wed 28 Oct 2026 18:00

Release schedule: Irregular

Consensus forecast: 4%

Prior reading: 4%

Data source: Federal Reserve