Fundamentally speaking we are very bearish on the USD and have been since March-April 2020 when the Coronavirus pandemic pushed global Central Banks to increase their asset purchasing program and their balance sheet to new all time highs. This massive round of Quantitative Easing has weighted heavy on the US Dollar which has devaluated by around 10% since its peak in March.
Having said that we are looking at a possibility of a short term rally in the US Dollar. Technically speaking the DXY (US Dollar Index) is bottoming around the 92.00 mark and has been trading in a range since late August. US Unemployment Claims and Philly Fed Manufacturing Index are key today. Unemployment Claims have stabilized at around 700k per week after the big spike on the pandemic lockdown (6M+) so our eyes are on the Philly Fed Manufacturing Index which is a gauge to how well the economic activity is doing. Last month the Philly Fed Manufacturing Index surprised the market beating expectations by double (32.3) and today it also beat expectations (26.3 vs 22.0) but came lower than last month's number. The overall reaction seems to be neutral but we have to wait until the New York open to see the US volume in. Do you want to trade the US Dollar with us? SUBSCRIBE today to our PRO TEAM for only $34.95