💵🔻Dollar Headwinds Ahead of FOMC Rate Hike

• The FOMC is about to start its policy tightening, and market participants seem to be divided on the direction of the dollar. A Bloomberg analysis piece noted several factors serving as headwinds for the dollar

• Seasonality is set to kick in after mid-March, this does not favour upside in USD.

• Volatility measures are falling on the session, the VIX closed below 30 for the first time in 11 sessions and now tests < 27.0

• Bloomberg reports hedge funds trimming EUR/USD short positions

• A measure of dollar, BBDXY, tests a key Fibonacci level at 1,205.19 (50% Fib)

Volatility Indexes:

VIX

JPM FX Vol Index

BofA Move Inex

Dollar Seasonality:

Dollar Index:

Testing Key Retracement