CoinEx News — During the Asian session on Tuesday, the U.S. dollar index traded sideways near 101.80 after edging lower in the previous session. Markets are awaiting the outcome of the U.S. midterm elections, with geopolitical tensions between the U.S. and Iran providing safe-haven support; however, dovish remarks from Federal Reserve officials and concerns over slowing AI investment have weighed on U.S. Treasury yields. The market is pricing in a roughly 73% probability of a rate hike in December, and this Friday’s non-farm payrolls report will be a key short-term driver for the dollar.
According to Huitong Finance APP — The US Dollar Index, which measures the US dollar's performance against six major currencies, remained range-bound during Tuesday’s Asian trading session, trading near 101.80 after a slight decline in the previous session. Traders maintained a cautious stance, awaiting the outcome of the US midterm elections. Rising energy prices due to ongoing tensions with Iran have increased political pressure on the US president and the Republican Party. Prediction markets indicate a 74% probability that the Democratic Party will gain control of the Senate; policy expectations stemming from this election are likely to cause temporary volatility for the dollar.
Beyond the election, the market will focus on the upcoming U.S. employment data series, as employment reports reflect the current state of the labor market and further shape expectations for the Federal Reserve's future monetary policy. The Federal Reserve opted to hold rates steady at its October meeting; current CME tools indicate a roughly 73% probability of a rate hike in December. Market surveys suggest that the U.S. conducted a limited covert strike against Iran’s Qeshm Island, generating some safe-haven buying that provided support for the dollar. However, prior remarks from Federal Reserve Chair Powell conveyed a patient policy stance, with no strong signal of tightening even as inflation improvements stalled. Combined with market concerns over slowing investment in the AI sector, this has pressured short-term U.S. Treasury yields, exerting downward pressure on the dollar.
Brown Brothers Harriman analysis notes that last week, the U.S. dollar and short-term Treasury yields moved lower in tandem, driven partly by the Fed’s patient stance and partly by market concerns over a cooling in AI investment, which has cast doubt on the U.S. economic growth outlook and further reduced expectations for rate hikes, putting downward pressure on the dollar. The firm’s strategists highlight this Friday’s October nonfarm payrolls report, with market expectations calling for 65,000 new jobs—up from 29,000 in September—indicating a gradual stabilization in labor demand. The unemployment rate is forecast to hold steady at 4.2%, above the Fed’s 2026 projection of 4.1%. On wages, the market expects a 0.3% month-over-month increase in hourly earnings and a year-over-year decline to 2.9%, suggesting marginal easing in wage pressures. Trade-related concerns are not currently dominant; instead, risk-off sentiment, employment data, and Fed expectations are the primary drivers of dollar movements.
On the daily chart, the US Dollar Index is generally in a high-range consolidation pattern, with price oscillating near the mid-term moving averages. Upward momentum has clearly weakened, and the RSI has retreated into the neutral zone, neither entering overbought nor oversold territory. The major bullish structure has not been fully broken, but further upward momentum is lacking. The daily consolidation range is centered between 101.20 and 102.40; a sustained break above 102.40 would be required to restart the uptrend, while a valid breakdown below 101.20 would open the door to a deeper correction. On the 4-hour chart, short-term price action is ranging sideways, with short-term moving averages intertwined without forming a clear directional alignment; indicators are oscillating within the neutral zone, and the market lacks internal momentum, primarily awaiting fundamental catalysts to determine direction. The first resistance above is at 102.10, with strong resistance at 102.40; immediate support below is at 101.50, and key defensive support at 101.20. While price remains within this range, maintain a sideways trading bias.
Editor's Summary
The US dollar is currently caught in a tug-of-war between safe-haven support and cooling monetary policy expectations. The Israel-Iran conflict provides a safe-haven floor, while the Fed’s patient stance and concerns over AI investments cap upward momentum. Key short-term variables are the US midterm elections and Friday’s nonfarm payrolls data—new jobs, unemployment rate, and wage figures will directly adjust the probability of a December rate hike. On the risk side, a strong nonfarm report combined with escalating geopolitical tensions could drive a dollar rebound; conversely, significantly weak employment data may dampen rate hike expectations and trigger a dollar pullback. Wait for the key data release, then watch for breakout signals above the 101.20–102.40 range, and remain alert to sharp volatility driven by events.
Beyond the election, the market will focus on the upcoming U.S. employment data series, as employment reports reflect the current state of the labor market and further shape expectations for the Federal Reserve's future monetary policy. The Federal Reserve opted to hold rates steady at its October meeting; current CME tools indicate a roughly 73% probability of a rate hike in December. Market surveys suggest that the U.S. conducted a limited covert strike against Iran’s Qeshm Island, generating some safe-haven buying that provided support for the dollar. However, prior remarks from Federal Reserve Chair Powell conveyed a patient policy stance, with no strong signal of tightening even as inflation improvements stalled. Combined with market concerns over slowing investment in the AI sector, this has pressured short-term U.S. Treasury yields, exerting downward pressure on the dollar.
Brown Brothers Harriman analysis notes that last week, the U.S. dollar and short-term Treasury yields moved lower in tandem, driven partly by the Fed’s patient stance and partly by market concerns over a cooling in AI investment, which has cast doubt on the U.S. economic growth outlook and further reduced expectations for rate hikes, putting downward pressure on the dollar. The firm’s strategists highlight this Friday’s October nonfarm payrolls report, with market expectations calling for 65,000 new jobs—up from 29,000 in September—indicating a gradual stabilization in labor demand. The unemployment rate is forecast to hold steady at 4.2%, above the Fed’s 2026 projection of 4.1%. On wages, the market expects a 0.3% month-over-month increase in hourly earnings and a year-over-year decline to 2.9%, suggesting marginal easing in wage pressures. Trade-related concerns are not currently dominant; instead, risk-off sentiment, employment data, and Fed expectations are the primary drivers of dollar movements.
On the daily chart, the US Dollar Index is generally in a high-range consolidation pattern, with price oscillating near the mid-term moving averages. Upward momentum has clearly weakened, and the RSI has retreated into the neutral zone, neither entering overbought nor oversold territory. The major bullish structure has not been fully broken, but further upward momentum is lacking. The daily consolidation range is centered between 101.20 and 102.40; a sustained break above 102.40 would be required to restart the uptrend, while a valid breakdown below 101.20 would open the door to a deeper correction. On the 4-hour chart, short-term price action is ranging sideways, with short-term moving averages intertwined without forming a clear directional alignment; indicators are oscillating within the neutral zone, and the market lacks internal momentum, primarily awaiting fundamental catalysts to determine direction. The first resistance above is at 102.10, with strong resistance at 102.40; immediate support below is at 101.50, and key defensive support at 101.20. While price remains within this range, maintain a sideways trading bias.
Editor's Summary
The US dollar is currently caught in a tug-of-war between safe-haven support and cooling monetary policy expectations. The Israel-Iran conflict provides a safe-haven floor, while the Fed’s patient stance and concerns over AI investments cap upward momentum. Key short-term variables are the US midterm elections and Friday’s nonfarm payrolls data—new jobs, unemployment rate, and wage figures will directly adjust the probability of a December rate hike. On the risk side, a strong nonfarm report combined with escalating geopolitical tensions could drive a dollar rebound; conversely, significantly weak employment data may dampen rate hike expectations and trigger a dollar pullback. Wait for the key data release, then watch for breakout signals above the 101.20–102.40 range, and remain alert to sharp volatility driven by events.