Analysis of the past week

Throughout the week, trading in the foreign exchange market remained very restrained due to the limited dynamics of the US dollar. Growth of volatility in the main currency pairs was traced due to published statistics and significant statements. So, for example, the Canadian dollar showed an attempt to the rapid growth on positive Canadian data. The British pound strengthened thanks to statements by German Chancellor A. Merkel, which reduced the likelihood of a tough Brexit. But the overall market dynamics remained restrained, which explains the formation of the weekly side channel.

The American currency was traded all week in flat, restraining the market. The reason for this movement was the expectation of a hint at the US monetary policy from the US Federal Reserve Chairman, who spoke on Friday. Since the US Federal Reserve Chairman did not meet market expectations, the American dollar accelerated the decline and closed the trading week with a decline. The weekly volatility of the US dollar index was 0.50%, most of which fell on Friday. On Monday we can expect movement against Friday given the disappointment of the market and the collapse of the dollar. There were no actual claims of a reduction or increase in rates in the United States.

Fig. The US Dollar Index Chart H4. Current price – 97.80 (10-year government bonds yield – blue line)

Hanzenko Anton