State of the Market: the US dollar accelerated decline

On Tuesday, the US currency accelerated the decline against the basket of major competitors on the positive dynamics of stock indices. The second day in a row, the stock markets of the Asia-Pacific region start trading in growth, which causes an increase in optimism in the market. Maintaining a correction on the stock indices indicates the possibility of long-term recovery of stock markets, which will eventually return demand for risky assets and, as a result, will increase pressure on the American.

The US dollar index, amid the recovery of optimism, is clamped in a downtrend, and the break through of support at 90.00 points to the possibility of further decline. At the same time, the area from 90.00 to 90.40 is a reversal.

Graph of the US dollar index. The current price is 89.90.

In turn, a full-scale recovery of stock indices could trigger a new wave of the US dollar sales. This may be a reason, which can serve as the preservation of risks in the US and the overvaluation of the US currency.

Hanzenko Anton