Analysis of past week

Last trading week was extremely negative for the US dollar, which weakened against most key currencies.

The main pressure on the American dollar had a number of factors:

• The increase in the likelihood of the US Federal Reserve rates cuts by due to weak US data, which in fact proved the need for the Fed stimulus measures.
• A reduction of risks in Europe, namely, the Brexit agreement between the EU and the UK, which reduced the likelihood of Britain’s tough exit from the EU and returned the demand for European currencies.

The US dollar index closes this week with a decrease of 1.50% against its main competitors against the background of the news. Thus, it broke the three-month uptrend and moved on to a rapid decline, dropping to the September close lows at 97.40-50. A further decline in the American dollar is limited by its oversold and support levels: 97.30, 97.00 and 96.80. In an upward correction, the resistance is the marks: 97.80 and 98.00.

Fig. US Dollar Index Chart H4. Current price – 97.50 (10-year government bonds yield – blue line)

Hanzenko Anton