THE US DOLLAR to THE PRICE OUTLOOK TURNS OPTIMISTIC OF THE FED’S POWELL’S SPEECH MINIMIZES THE NEGATIVE INTEREST RATES; CORONA VIRUS, AND THE TRADE WITH CHINA OF THE WAR AND THE RISK OF FUEL VOLATILITY, FX
- The US Dollar strength last week and drove the DXY Index is higher than 1.25% towards the 100.50 price
- Price in USD climbed on the back of the FOMC comments push back on the negative interest rate policy
- The US Dollar could extend its advance, that the trade tension with China, the fuel to the volatility in FX
The U.S. Dollar, the outlook appears more positive, in consideration or developments which have taken place over the past few trading sessions. The dollar price of the action, slightly higher the post-Powell after the Federal Reserve Chairman reiterated the central bank’s position with the help of a negative-interest rate policy, or IT.
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With several other The Federal Reserve officials, President of the federal reserve, and secretary Powell has spoken out against the idea of the adoption of negative interest rates in the united States of america as a channel of monetary stimulus. In response to the recent The rhetoric of the Fedthe US Dollar was churned higher to reflect the forward rate guidance of Barry, but has been relatively less dovish than hoped for by market participants.
DXY INDEX, A US DOLLAR PRICE CHART, DAILY TIME FRAME, UNTIL 26 MARCH TO 15 MAY, 2020).
Graphic created by @RichDvorakFX with TradingView
Because of the last part of the broad based strength of the U.S. Dollar against other the major currenciesthe DXY Index jumped back above the psychologically important$ 100.00, price levels, and reclaimed its 50-day and has become the most popular as well. That said, there could be potential for the U.S. Dollar to continue its ascent.
With the U.S. Dollar on the rise with the volatility in FXthe apparent return of the risk aversion and the deterioration in market sentiment, could propel the DXY Index is still higher if the demand for safe-haven currencies as the dollar is supported.
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Another fundamental requirement of catalyst, weighing in on the direction of the U.S. Dollar includes rekindled the tension and exchange, it is the uncertainty between the UNITED states and China. The major risk posed by The us-China trade wars 2.0 could provide a positive back to the whole of the US Dollar. This is considering the us-China trade tension may weigh significantly on trader risk appetite and fuel volatility in the market.
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— Written by Rich DvorakAnalyst for the DailyFX.com
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