Fed Rate Hike Expectations Rise Ahead of CPI Data and Powell Speech

The DXY is trading at 101.07, very close to its 50-day moving average (101.06). The RSI is at 42.6, in neutral territory, while the MACD remains below the signal line, indicating weak short-term momentum. News headlines point to rising Fed rate hike expectations, which typically support the DXY, but pricing may remain limited as the market awaits CPI data and Powell's speech. Technically, the 20-day SMA (101.21) stands as resistance, while the 50-day SMA (101.06) acts as support. Therefore, a sideways move is expected ahead of the data and speech.

USDJPY is trading at 162.19, closing below the 20-day SMA (162.35), signaling short-term weakness. The RSI at 44.8, below the neutral zone, indicates downward momentum. The MACD line remains below the signal line, suggesting sustained selling pressure. While rising Fed rate hike expectations could broadly support the USD, technical indicators maintain a bearish bias in the near term. Therefore, a downward move is expected in the 1-3 day perspective.

The NDX is near oversold territory with an RSI of 38.3, but the MACD remains below the signal line and in negative territory. The price is trading below both the 20-day and 50-day moving averages, indicating short-term weakness. Rising expectations of a Fed rate hike could pressure technology stocks. Markets may remain cautious ahead of CPI data and Powell's speech, but the current technical structure supports a bearish trend.

The Nikkei 225 is trading below its 20-day and 50-day moving averages, signaling short-term weakness. The RSI is just below 50, indicating neutral momentum with slight selling pressure. The MACD line is below the signal line and in negative territory, confirming a bearish trend. Rising expectations of a Fed rate hike could negatively impact global risk appetite, putting pressure on Japanese equities. Therefore, the Nikkei 225 is expected to maintain its downward trend in the short term.