Dollar has a potential of 5% rally

10 August, 2018

The dollar rewrote 13-months highs on Friday to a basket of six major currencies, adding 0.25% after gaining 0.5% on Thursday. The further growth of the US currency from the current levels would mean the end of the consolidation period, which has lasted since May, when the index has fluctuated in a relatively narrow range. The way out of this range can start a new stage of the American currency strengthening, as it was in April-May. The repetition of the spring rally is able to send the dollar index to 100, the psychologically important level, where it had a significant resistance in 2015-2017, being only briefly receding above.

The growth of the dollar this week is mostly due to other currencies’ problems and is not caused by the strong output of American economy. However, the most dramatic decline can be seen for the currencies of the countries with which the United States has some kind of disputes. While the weakening of currencies to the dollar is due to the outflow of investors, there is a higher risk that Trump will once again be dissatisfied with the strengthening of the dollar as it was last month when the symptom rally of the dollar was stopped by Trump’s call for a softer Fed policy.

However, the dollar is strengthened for quite objective reasons, so it is unlikely that Trump’s comments would fundamentally roll the course of the American currency.

Once again, the Turkish Lira was among the main victims. It collapsed over the last 24 hours by 7.5% to a new historical low of 5.72 per dollar due to the diplomatic conflict between Ankara and Washington. Since the beginning of the year, USDTRY pair has skyrocketed by 51%.

The Russian rubble lost to the dollar 1.7% on Thursday up to 66.65 per dollar, increasing the pace of the decline since the beginning of the month to 6.7% on the outflow of investors from Russian assets under the threat of new U.S. sanctions.

This morning, sterling has fell to 1.2815, the lowest rate since August 2017 on investors’ fears that Britain would leave the EU without an agreement with Brussels, which would exacerbate economic uncertainty for the country.

The EURUSD pair has fallen on Friday morning below 1.1500, the lowest rate since July 2017 and below trading range for the last 3 months that increased a sale-off by massive stop-orders flow. A single currency is under pressure due to uncertainty around Britain and worries about the Turkish exposure to some European banks.

In addition, the ECB commented on the euro that the increasing protectionism raises risks for the global growth. This was perceived as a signal that the regulator might be willing to soften its rhetoric in the event of a trade conflicts proliferation.

The New Zealand dollar lost 2% to lows of 2.5 years after RBNZ had predicted that it would not raise the rates until 2020.

In the context of reduced trading volumes due to the vacation period, the dollar’s output beyond the established trading range can turn into a rather sharp rally in the coming days.


Source link  
Markets are optimistic but remain weary

The markets remain on cautious positive mood. MSCI for Asia-Pacific region adds 0.4%, continuing gently recover for the second day in a row. American...

Dollar updates its 14-month highs

The strengthening of financial markets on Tuesday has not been unsustainable and prolonged. Recent shots in the U.S. trade conflicts are: a Chinas claim...

BoJ cautions keep forex calm

In the currency market, the dollar was under some pressure following the data that indicated a weakening of the inflation in the Eurozone. The slowdown in prices...


Stocks are growing, Bonds under pressure

The situation in the world markets looks controversial. Shares are growing after strong reporting of companies. The shares of Alphabet (#Google) jumped by 3.6% after...

The potential of USD growth is limited

Powell's speech with the semiannual report in the U.S. Congress contained an optimistic view on the economic outlook. Such a tone has reduced fears that...

Oil drops back into June price range

The WTI Oil price fell from $72.98 to $68.68 yesterday despite the inventories data showing a draw of -12.6M barrels which is the biggest since September 2016...


Dollar is weaker today after rejection 95.50

The USD has weakened against the majors after the DXY rejected the 95.50 level in yesterday's trading creating a technical double top and is now trading down...

Stronger IT, softer financials

Stock markets continue to strengthen with increased demand for high-tech companies. The NASDAQ100 closed a second day in a row...

USD weakens through the day yesterday

The USD weakened further overnight after the move began in the US trading session yesterday. USDJPY moved down under the 110.000 level after...


In the past 24 hours Bitcoin has lost -3.1% and reached $6310.42395036. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has gained 0.2108% and is now at $1.1431. Start trading and making money on Forex today.

In the past 7 days Ethereum has lost -1.81% and is now at $274.900295332. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Forex Market Analysis



Forex Currencies Forecasts



Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets89%
2FXTMFXTM87%
3HYCMHYCM85%
4FxProFxPro80%
5FIBO GroupFIBO Group77%
6FXCMFXCM73%
7AvaTradeAvaTrade68%
8HotForexHotForex67%
9Alfa-ForexAlfa-Forex66%
10XMXM66%
  


Share: