- The US Dollar Trades Positive Traders Digest is the recent negative survey of the Dallas Fed manufacturing.
- The Trump administration has put an attempt at negotiations with China to focus on other countries first.
- The US Dollar Index is still trapped below a 100.00 level of rotation, which traded near 99.40 on Tuesday.
The US Dollar index (DXY), which monitors the US Dollar (USD) performance against six major currencies, is seeing a small bounce and trading at 99.35 at the time of writing on Tuesday. The dust is still organizing after the Dallas Federal Reserve (FED) released April April on Monday. Apart from the fact that the number contracted at -35.8, a number not seen from the covid pandemic, the actual report mentioned the comments of the participants.
Participants expressed their current emotions in words such as “chaos” and “insanity”, to illustrate the chaos released by US president's tariffs Donald Trump. It provides a blurry of how things don't like the US under current tariff schemes. The US produces sinking as well as entrepreneurs who bet on the rising opportunities for fed to cut interest Rates Instead of earlier than the latter, the upcoming US economic data should be this week, with the initial Q1 Gross Domestic Product (GDP) and the Nonfarm Payrolls (NFP) For April, be as embarrassing as the print of Dallas Fed manufacturing.
In front of the economic calendar, there were some lighter data early on Tuesday, with the main theme in Jolts Report on openings openings for March. Although it was backward, before US tariffs were implemented, it could now give a feeling if US companies were preparing for an impact and reduced their employment activity. In addition, the initial US trade balance is also expected for March.
Sun -Sun Digest Market Movers: The volatility set to peak again
- At 12:30 gmt, the initial US trade balance balance for March should be. No forecast available with the previous deficiency of $ 147 billion.
- The initial wholesale inventory for March was due at the same time, expected to tick 0.7% from an increase of 0.3% in February.
- At 13:00 gmt, the February home price index should be. It is expected to detect 0.3% from 0.2% in February.
- At 14:00 GMT, the Jolts Jolts Jolts reported for March is expected to contract 7.5 million, from 7.568 million previously. Consumer confidence for April should also be, even without an assessment available.
- Equal ones are stable with very small acquisitions to be generally, on average below 0.5% for both European indices and the markets in US futures.
- The CME Fedwatch's tool shows the chance of an interest rate cut by the Federal Reserve at the May meeting at 8.9% against a 91.1% possibility of no change. The June meeting sees a 62.6% chance of a cutting rate.
- The US 10-year yields trade around 4.23%, seeing a bit lower among entrepreneurs slowly but certainly buy back to US bonds.
US Dollar Index Technical Analysis: Not moving but there is something brewing
The US Dollar Index (DXY) will not go anywhere as entrepreneurs keep their powder dry for the key economic data later this week. Meanwhile, some geopolitical headlines in prevention of tariffs have been off-setting titles from China or other countries in response to the Trump administration. When viewing US data, the Dallas Fed manufacturing survey may be the first real signing that US economic performance will begin to deteriorate, calling for a rapid reduction in interest rates from Fedand a weaker US dollar before recovering economic numbers.
Upside down, DXY's first resistance came to 100.22, supporting DXY back in September 2024, with a break back above the 100.00 level of cycle as a bullish signal. A recovery firm was a return to 101.90, which acted as a pivotal level throughout December 2023 and again as a basis for the reverse head-and-shoulder formation in the summer of 2024.
On the other hand, the support of 97.73 can be quickly diagnosed with any large bearish headline. In addition, a relatively thin technical support enters 96.94 before viewing the lower level of the new price range. It is at 95.25 and 94.56, which means fresh lows that have not been seen since 2022.
US Dollar Index: Daily -Taral chart
US Dollar FAQ
The US dollar (USD) is the official currency of the United States of America, and the 'de facto' currency of a significant number of other countries in which it is found in circulation next to local notes. This is the most severely exchanged currency in the world, worth more than 88% of all global foreign exchange transfers, or an average of $ 6.6 trillion in transactions per day, according to data from 2022. Following World War II, the USD took from the British Pound as the world's reserve currency. For most of its history, the US dollar was gold -back, to the Bretton Woods agreement in 1971 when the gold standard left.
The most important single factor affecting the value of the US dollar is financial policy, shaped by the Federal Reserve (FED). Fed has two mandates: to achieve control inflation and promote full work. Its main tool to achieve these two goals is by organizing interest rates. When prices rise rapidly and inflation is above the target of 2% of the Fed, the Fed will increase rates, which contributes to USD value. When inflation falls below 2% or the unemployment rate is too high, the Fed may lower interest rates, with a greenback weight.
In extreme situations, the federal reserve can also print more dollars and make easing (QE) volume. QE is the process by which the Fed greatly increases the flow of credit to a stuck financial system. This is a non -standard policy proposal used when credit is dry because banks will not lend to each other (out of fear of default counterparts). This is a last way if only the decrease of interest rates is not likely to achieve the required result. It was the Fed weapon chosen to fight the credit crunch that occurred during the great financial crisis in 2008. It involves the Fed printing more dollars and used them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US dollar.
The quantity of tightening (QT) is the reverse process in which the federal reserve stops buying bonds from financial institutions and does not re -consist of the principal from the bonds it holds in new purchases. This is usually positive for the US dollar.
