Dollar Gains on Global Growth Concerns

Dollar

Dollar Index is trading up 0.38% at 101.50

The U.S. dollar climbed higher in early European trade Monday, gaining ground even against the euro despite Emmanuel Macron’s win in the French presidential election as traders sought out this safe haven.

At 3:05 AM ET (0705 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.4% higher at 101.625, climbing to levels last seen in late 2016.

French President Emmanuel Macron claimed an election victory over his far-right rival Marine Le Pen on Sunday, providing the euro with a small boost as the result provided stability within the European Union, avoiding the promotion of a deeply Eurosceptic politician.

However, any gains for the single currency were short-lived as traders turned to the safety of the dollar due to uncertainties over the global growth outlook as the U.S. Federal Reserve tightens monetary policy.

USD/JPY traded 0.4% lower to 128.09, edging back from its highest level in 20 years, with the dollar having gained around 11% versus the yen so far this year.

EUR/USD dropped 0.6% to 1.0727, dropping to a new two-year low after initially opening higher.

Elsewhere, USD/CNY rose 0.8% to 6.5518, climbing to a new one-year high, as the ongoing COVID-19 outbreak prompted concerns over the economic growth outlook of the world’s second largest economy.

On technical fronts Dollar Index RSI stood at 74.37 and currently it is trading above all MA. So, BUY position can be taken with following target and stoploss:

TRADE SIGNAL – : Dollar Index – BUY: 101.47, TARGET: 101.69, STOP LOSS : 101.28

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