Analysis of the past week

The beginning of May was very volatile due to a significant amount of news. But along with the volatility in the market, there was a multi-directional movement. As a result, the foreign exchange market during the week was trading in different directions.

The reason for the multidirectional movements remained the dynamics of the US currency. Thus, the US dollar index for the week showed a volatility of 0.97%. The driver for the change of sentiment on the American dollar served as significant news on the United States. The reason for the strengthening of the American dollar were the US Federal Reserve meeting results, according to which the likelihood of lower rates in the United States dropped significantly, supporting the dollar across the market and almost completely playing back the decline in the dollar index at the beginning of the week.

Published employment data in the United States turned out to be very positive, but they also showed a slowdown in wage growth, which in the future could aggravate the situation with low inflation. Additional pressure at the end of the week on the dollar had a correction on overbought and the return of pessimistic expectations for the US economy.

Fig. The US dollar index H4 chart. The current price is 97.60 (10-year government bonds yield is the blue line)

Hanzenko Anton