The US dollar has dropped to its lowest point this year, losing over 2.3% since August and around 4% since early July. This decline stems from expectations of a Federal Reserve (Fed) rate cut in September, which the market has started to price in. The dollar index, reflecting these shifts, has fallen to 101.7.
Global Central Banks and Dollar Weakness
While central banks in Europe, Canada, England, and New Zealand have already begun easing, the currency market reacts more to US monetary policy changes. Expectations of looser Fed policies in the coming months are weakening the dollar. Earlier this year, lower inflation was seen as a chance for policy normalization, but recent signs point to easing to avoid a recession.
Increased Likelihood of Rate Cuts
As economic outlooks shift, the chances of further rate cuts grow. There’s now a 60% probability of a 100 basis point or more cut by year-end, with one cut likely to be 50 basis points. This is a stark change from the 1.5% probability in early July.
Dollar Index at a Critical Point
Technically, the DXY Dollar Index is near the lower end of its range from early 2023. Past reversals from this level have triggered corrections in equities, though they haven’t ended the bull market. Fed Chairman Jerome Powell’s upcoming speech at Jackson Hole could either bolster the dollar or allow it to weaken further.
Bearish Scenarios and Future Projections
If the dollar continues to drop, the next key support lies between 99.2-100.4, with a possible fall to the 90-92.6 range. However, if Powell counters expectations of a 100-basis-point cut, especially with stable employment and 3% inflation, it could bring buyers back to the dollar. In this case, the DXY might climb to 106.2-107.0 before year-end.
Conclusion
The dollar’s future hinges on Fed actions and economic data in the coming months. Whether it recovers or continues to decline depends on how these factors play out.
I am not sure what the criticism is about here. I don’t see any solicitation for anything in his post. I get this same thing from some about using ChatGpt in my posts but I don’t, (never tried it). Maybe he did or maybe he didn’t but this kinda reply is why some people just quit posting, It’s like some here don’t want new people or thorough posts. Maybe that’s why the forums here have very little participation as compared to others.
My 2 cents,
J
All the formerly active member-participants here who explain openly that the “promotionally motivated posting and profiles” and the “AI-generated posts” are what’s driving them away from Babypips and to all the other forums where this kind of stuff is deleted on sight.
Okay, well you criticized him for solicitation of which there was none and now it’s just that he may or may not have used AI because, you don’t know that. Some people are just far more analytic than others. The funny thing is if, someone posts about trading a MA cross at 8am after a full moon, there would be people clapping and asking how they can learn more. Like I said. I don’t get it and I think this chases the best traders out of here.
I said that his profile-text reads like a sales-page (which it does, clearly), and that his post above was written by ChatGPT or an equivalent (which it was).
What is the reason anyone posts anything. I look at his other threads and didn’t find any solicitation. Maybe he read an article and thought the information might me helpful. I realize it’s not real popular here for a trader to actually do analysis or follow the fundamentals but there are still some that do. Why did you appoint yourself the posting police? Don’t they have moderators for that?
Whatever they “have for that” doesn’t appear to be working too well, does it? The forum’s losing most of its members and traffic. My point (and that of so many other people, by the way) is that this stuff is damaging the forum. Members are saying so, openly, as they leave!!
I disagree and don’t see that much of it and if so who cares. Now I would be right with you if it was solicitation and someone was using AI to help generate information and posts for the purpose of selling some sort of trading system or EA. That is not what happened here. He could have simply posted from an article, who knows. I would say the biggest threat to the forums here are apathy and lack of participation when someone posts actual good content. But anyway, I think you chose the wrong post to criticize. There are actual solicitations that I see all the time.
It’s all good with me. That one hit a nerve with me because I have been accused of doing the same but I just do a complete analysis before every trading day on 3 or 4 pairs and use the same form of posts. I do make it look nice and format it in a professional way. I also send it, for free, to several of my trading friends every evening. But, I have stopped posting as much because people criticize an in depth post when they could probably benefit from take a minute or two to read it. That’s all!
I like this topic. The dollar will go through some changes starting this year with the rate cuts. It’ll really interesting to see what happens with the US economy and all the effects around the world from the rate cuts here and other countries too.
i like the topic, also. That’s why I read it with interest in the first place.
I just dislike (as do so many other members who all say so openly, often as they’re leaving Babypips!) reading posts written by ChatGPT and pasted in here by “members” whose profiles read like a sales page!! Don’t you, @samewise ?
I’m okay with chatgpt style posts if I’m learning something. Nothing shouted I’m selling something from his info. I probably wouldn’t even looked at it, but you said something about it. Looks fine to me. No links or company names or posts.
