Dollar edges back towards one-month low

Dollar Index

Dollar Index is trading down 0.22% at 101.75

The U.S. dollar edged back towards a one-month low on Thursday, as minutes from the Federal Reserve’s May meeting contained few surprises, with most participants favouring additional 50 basis point rate hikes at the June and July meetings.

The dollar index, which measures the currency against six major peers, was down 0.2% at 101.83 as the minutes showed the Fed is likely to stay the course for now, but keep its options open for a range of policy choices after July.

The index has mostly been consolidating around 102 after a short-lived bounce immediately following Wednesday’s release of the minutes.

Analysts noted that expedited tightening would allow some wiggle room if the Fed wanted to slow the tightening cycle in the second half of the year.

The dollar index reached a nearly two-decade peak above 105 mid-months, but signs that aggressive Fed action may already be slowing economic growth have prompted traders to scale back tightening bets, with Treasury yields also dropping from multi-year highs.

The implied yield on the Eurodollar futures June 2023 contract — essentially where markets see interest rates to be at that point — is down some 80 basis points this month.

ING believes there is room for this to reverse, with the Fed believing the economy is strong enough to withstand rapid tightening.

On technical fronts Dollar Index RSI stood at 27.03 and currently it is trading below all MA. So, SELL position can be taken with following target and stoploss:

TRADE SIGNAL – : Dollar Index – SELL: 101.85, TARGET: 101.69, STOP LOSS : 102.18

About Author

Related posts

Dollar Index

Dollar Edges Lower; RBA Hikes Interest Rate

AUD/USDis trading down 1.12% at 0.6782 The U.S. dollar edged lower in early European trade Tuesday, while the Australian dollar dipped despite the country’s Reserve Bank announcing a half-point rate hike. At 3 AM ET (0700 GMT), the Dollar Index, which tracks the greenback against a basket of six...

Read More
European stock markets

European Stocks Largely Higher; DAX Underperforms After Trade Deficit 

FTSE 100 is trading up 0.65% at 7196.67 European stock markets edged largely higher Monday, starting the new week on a positive note despite the Wall Street holiday limiting activity. By 03:40 AM ET (0740 GMT), the DAX in Germany traded 0.1% lower, while the CAC 40 in France...

Read More
copper

Copper set to end June with a 16-month low

The price of COMEX Copper futures is down 2.33% at 3.6925 per pound on mid-Thursday trades. Copper prices further declined on Thursday. This makes copper prices on track for the biggest quarterly percentage fall since March 2020. The potential of a recession occurring coupled with the decline in demand...

Read More

Leave a Reply