- The US dollar index is slightly lower, although the daily beach is tighter.
- Merchants estimate on Monday the risk of overlapping the overvoltage of the Taiwan dollar to other currencies in the region.
- The US dollar index remains capped below 100.00, still stuck in a waiting range.
The US dollar index (DXY), which follows the performance of the US dollar (USD) compared to six major currencies, the edges below while remaining stuck Tuesday in a very tight range. Market players assess the recent net decision in the Taiwan dollar (TWD), which appreciated more than 5% compared to the greenback on Monday before retiring somewhat on Tuesday. The markets are trying to assess whether an overflow effect could occur, affecting the biggest Asian currencies such as South Korean Won (KRW), the Japanese Yen (JPY) or the Chinese Renminbi (CNH).
Meanwhile, on the geopolitical front, a swarm of major titles is heading for the markets, with the most recent the next German Chancellor Friedrich Merz below a majority to the vote of the German Parliament to become the new Chancellor. On the other side of the Atlantic, the American trade secretary, Howard Lunick, compared the challenges of the Trump administration in order to soon deliver an initial trade agreement by saying that the first agreement was to be with an economy “Top Dix”, he said on Fox News. In Europe, war between Russia and Ukraine warms with drone attacks on both sides, while Israel is preparing an offensive on the ground in order to fully control the Gaza Strip.
Daily Digest Market Movers: slow data before the Fed
- At 12:30 p.m. GMT, the American trade balance of goods and services for Mars is due. Expectations are intended for a larger deficit at 129 billion dollars compared to the deficit of $ 122.7 billion from February.
- Actions are everywhere because several Asian countries remain closed for a public holiday. European indices are up approximately 0.50% per day, while American term contracts look under pressure with the Nasdaq down almost 1%.
- The CME Fedwatch tool shows the chances of a drop in the interest rate by the federal reserve at the May meeting of 3.2% against a probability of 96.8% without change. The June meeting sees 31.8% of a drop in rates.
- American yields at 10 years are negotiated around 4.31%, erasing the softening of past weeks, traders, traders have even evaluated the chances of a rate drop in June.
Technical analysis of the US dollar index: internal pressure
The US dollar index (DXY) faces certain opposite winds after the US Secretary of Trade Lutnick increased pressure from the Trump administration to conclude an initial trade agreement. Lutnick added that the initial agreement should be with an economy among the first ten, in order to give an example. Despite several complaints from American President Donald Trump and several members of the cabinet that the agreements are imminent, no real transaction signed has been announced.
Uplining, the first resistance of the DXY presents itself at 100.22, which supported the DXY in September 2024, with a rupture above the round level of 100.00 as a Haussier signal. A firm recovery would be a return to 101.90, which acted as a central level throughout December 2023 and again as a basis for the reverse head and shoulder formation (H&S) during the summer of 2024.
On the other hand, support 97.73 could quickly be tested on any substantial downside. Further below, relatively thin technical support is available at 96.94 before looking at the lower levels of this new price range. It would be 95.25 and 94.56, which means fresh stockings that we have not seen since 2022.
US dollar index: daily graphic
American-Chinese trade faq
In general, a trade war is an economic conflict between two or more countries due to extreme protectionism at one end. This implies the creation of commercial barriers, such as prices, which cause counter-barriers, an increase in import costs, and therefore the cost of living.
An economic conflict between the United States (United States) and China began in early 2018 when President Donald Trump set trade obstacles on China, claiming unfair commercial practices and an intellectual property flight from the Asian giant. China has taken reprisal measures, imposing prices on several American products, such as cars and soybeans. Tensions intensified until the two countries signed the US-China phase trade agreement in January 2020. The agreement required structural reforms and other changes to the economic and commercial regime of China and pretended to restore stability and confidence between the two nations. However, the coronavirus pandemic has focused on the conflict. However, it should be mentioned that President Joe Biden, who took office after Trump, maintained prices in place and even added additional samples.
Donald Trump's return to the White House as 47th American president sparked a new wave of tensions between the two countries. During the 2024 electoral campaign, Trump has committed to imposing prices of 60% on China once he became his functions, which he did on January 20, 2025. With Trump back, the American-Chinese trade war is supposed to resume the untrings in the global supply chains, resulting in a reduction in investment, in particular investments, and food consumption.
