- The US Dollar Index (DXY) turns around from 93.34 to break the two-day winning streak.
- Dr. Fauci pours cold water on the face of the Trump administration’s campaign to cure the virus.
- The Sino-US trade deal is regaining market attention as diplomats cite a “constructive” conversation.
- U.S. Consumer Confidence, Housing Data at the Center of Intraday Movements.
The US Dollar Index (DXY) slashes the gains of the previous two days while falling to 93.15, down 0.17%, ahead of Tuesday’s European session. The greenback’s gauge against major currencies recently fell as U.S. health official Anthony Fauci poured cold water in the face of the Trump administration’s efforts to speed up treatment for the coronavirus (COVID-19 ). The market rush for riskier assets could also weigh on the listing following upbeat comments from US and Chinese trade officials.
Dr. Anthony Fauci, the head of the US National Institute of Allergy and Infectious Diseases, challenged the rush of the government led by President Donald Trump to acquire a vaccine against the virus and permission to use plasma. The health official said “the vaccine rush could undermine the trials of other promising candidates.”
Elsewhere, a dialogue between U.S. Trade Representative Robert LIghthizer and Chinese Vice Premier Liu He of China suggests diplomats have had constructive conversations about strengthening macroeconomic policy coordination and the phase one agreement. The trade deal was previously considered dead as the world’s two largest economies crossed paths during the virus outbreak.
Declining virus counts in Florida, Victoria, Tokyo and China could also offer a far-flung push to general risk sentiment, while weighing on the US dollar.
Amid all these catalysts, the S&P 500 Future refreshes the record with 3,445.88 while tracking the gains on Wall Street. On the flip side, Asia-Pacific stocks are also accepting offers amid commercial optimism, while 10-year US Treasury yields add two basis points (bps) to 0.66% at the time. of the press.
Going forward, traders will be waiting for August consumer confidence and second-tier housing data from the US for immediate direction. While most forecasts suggest an optimistic drawdown economy, any disappointment will place an additional downward burden on the greenback. Even so, markets may remain volatile ahead of weekend talks by global central bankers at the Jackson Hole Symposium.
The 21 day EMA and a downtrend line from 03 August limit the gauge’s immediate rise near 93.50 and 93.77 respectively. On the downside, the 93.00 and 92.520 line could entertain sellers before pointing to a multi-month low near 92.10. It’s worth mentioning that the bears will likely hold onto the throne unless the quote breaks through the March low near 94.65.