USD faces pressure ahead of Fed meeting and Big Tech earnings week

USD index trading at 108.20, showing signs of consolidation as markets brace for the busiest week of Q1. The Federal Reserve's January meeting on Tuesday-Wednesday takes center stage, with traders expecting the Fed to hold rates at 4.25-4.50% while parsing Powell's commentary for future policy guidance. Big Tech earnings from Microsoft, Apple, Meta, and Amazon could significantly impact risk sentiment and dollar flows, as these companies represent over 30% of S&P 500 market cap. Current geopolitical tensions provide underlying support for safe-haven USD demand, limiting downside moves. Technical indicators show USD index facing resistance at 108.50 (January high) with support at 107.80 (50-day MA). A dovish Fed tone could pressure USD across major pairs, particularly EUR/USD and GBP/USD, while hawkish surprises might propel the dollar toward 109.00. Traders should monitor tech sector performance as a key driver of overall market sentiment this week.