The Dollar Index (DXY) gaps as markets price an 80% chance of a December Fed cut, extending the shift in Fed rhetoric, OCBC's FX analysts Frances Cheung and Christopher Wong note.

Two-way risks with bias skewed to the downside

"DXY gapped lower in the open this morning as Dec rate cut probability continues to rise to 80% amid shift in Fed rhetoric earlier. DXY last seen at 99.59 levels. Our earlier technical caution for spinning top – an indication for indecision as well as a signal for some weakness in the recent USD rebound – played out."

"Daily momentum turned mild bearish while RSI fell. Still see 2-way risks with bias skewed to the downside. Support at 99.00/10 (50 DMA, 50% fibo retracement of May high to Sep low), 98.50 (100 DMA). Resistance at 99.70 levels (21, 200 DMAs, 61.8% fibo), 100.6 (76.4% fibo). US markets are out for Thanksgiving holidays today with no data and Fedspeaks for the week."