Federal Reserve Chair Kevin Warsh’s keynote at the Jackson Hole Economic Symposium on August 28 sparked a shift toward a more hawkish outlook for Fed policy, according to OANDA. Warsh emphasized that the Fed’s primary focus should be on price stability, noting that more than half of the PCE basket components remain above the 3% mark. His comments lifted the odds of a 25‑basis‑point rate hike at the September FOMC meeting to 67%, up from roughly 30% before the speech.
Dollar Index Holds Near Resistance
The U.S. Dollar Index (DXY) has entered a sideways range around the 100.54 resistance level, caught between higher short‑term U.S. Treasury yields and expectations of tighter policy from several G10 central banks. The two‑year spread between the U.S. Treasury note and an equal‑weighted basket of sovereign bonds from Germany, the U.K., Japan, Canada, Switzerland, Australia and China remains below the 1.79% resistance line.
FX Pairs Offering Potential Opportunities
OANDA points to six currency crosses that may present attractive risk‑reward setups over the coming weeks:
- AUD/NZD – After a 12‑week decline of 2.8% from its 52‑week high, the pair rebounded above its 50‑day moving average on August 27. A break above 1.2320 could open the path to 1.2630 and 1.2930, while a drop below 1.1940 would expose support at 1.1665 and 1.1414.
- EUR/AUD – Trading within a descending triangle since the March 11 swing low of 1.6135, the pair faces downside risk if it falls below that level, with support at 1.5850 and 1.5300. A rally above the 1.6590 resistance could push the price toward 1.6847 and 1.7290.
- EUR/GBP – Moving in a medium‑term descending channel since November 14, 2025, the pair is capped below a resistance near the 58 RSI level. A break above 0.8625 may lead to 0.8735 and 0.8790, while a fall below 0.8530 would bring support to 0.8455 and 0.8370.
- GBP/JPY – After a 4.6% slide from its 52‑week high, the pair has held above its 200‑day moving average since May 22, 2026. A move above the 219.61 resistance could target 223.00 and 229.65; a dip below 212.40 would expose support at 209.63, 207.68 and 200.28.
- CHF/JPY – Trading below its 200‑day moving average, the pair faces bearish momentum with RSI near 56. A break above the 199.20 resistance could lift the price toward 201.55 and the all‑time high area around 204.00‑204.43. A fall below 196.60 would open support at 192.65 and 187.60.
Considerations for Traders
While the dollar’s near‑term range suggests limited directional bias, the highlighted pairs each exhibit distinct technical patterns that may offer entry points for disciplined traders. OANDA reminds readers that forex trading carries high risk and losses can exceed deposits. This analysis is for educational purposes only and should not be taken as trading advice.
Original reporting: KRDO (Colorado Springs metro) — read the source article.
