Despite the debate about the strength or weakness of the US dollar, it will remain one of the most important currencies in the world for decades and continue to cause some trouble.
Still, new monetary paradigms are shifting in the global oil market and Sovereign foreign currency reserves as two examples.
So, where is the USD going?
Only time will tell, but in the long term, the dollar will most likely drift lower but is in a unique area of support and resistance now.
The US dollar has weakened almost 50% from the highs earlier this year, so breaking this 50% support area could alter the dollar’s trajectory and, if it holds, could provide continued support for now.
The chart below shows the US dollar compared to the euro. 1.07 is a support level for the euro.
1.09 also happens to be the 50% retracement from the highs, so most likely, the euro will find resistance coinciding with this area, but the euro might also strengthen.
These intersections are generally dependable, and the euro will likely hit resistance and turn back down. Still, if the euro rises to 1.11, that might signal a larger paradigm shift in currency trends.
Despite a challenging year for asset markets, the US dollar remains an essential cornerstone of financial transactions worldwide and means of exchange.
Unlocking your potential for profiting from trends could be easier than you think, and remember to keep your eye on key 50% support levels for the dollar’s next move.
