Analysis of the past week

In fact, the last full working week of 2018 closes with a sale of the US dollar against a basket of currencies. The reason for the downward dynamics of the American dollar is the growing risks of the world economy and data for the United States, among which is the US Federal Reserve meeting results and heightened political risks in the United States. So, the US Federal Reserve, despite the fact that it raised interest rates, lowered expectations for the number of rate hikes in 2019, which became the main factor for the sale of the dollar. In addition, the US government has exacerbated the risks of political confrontation around the adoption of the US budget, which also has a negative impact on the dynamics of the dollar.

As a result of the week, the US dollar index closes with the December low at 96.20. Friday’s trades, in turn, are closed with growth on the correction of short positions before long weekends in the world due to the celebration of Christmas. It should be noted that the downward trend in the dollar is preserved, and the correction is limited to the levels: 96.70-80 and 97.00. A decrease in liquidity during the holiday period may cause the formation of a flat.

The US dollar index H4 chart. Current price – 97.70 (10-year government bond yield – blue line)

Hanzenko Anton