Analysis of the past day

Trading in the foreign exchange market showed a significant increase in the main currency pairs against the US dollar on Wednesday. The reason for the decline of the US dollar during the Asian and European sessions was the preliminary data on the mid-term elections in the United States with the results that the Democrats received a majority in the US House of Representatives. In turn, it complicated the work of the Trump administration significantly and, as a result, heightened US political risks.

Stock indices for the day closed mostly above zero (Nikkei 225-0.10,; DAX +0.60; FTSE 100 +0.90; Dow 30 +0.80), on the general decline of the American dollar and the increase in optimism that was caused strengthening commodity assets.

The US dollar index at the end of the day updated its low at the level of 95.70, which was caused by the increase in political risks in the United States as a result of the elections. At the same time, the level of 95.70 also became a reversal, the rebound from it indicates a correction on optimistic expectations regarding tomorrow’s  the US Federal Reserve meeting.  Resistance levels are: 96.00 and 96.20.

The US dollar index chart. The current price is 95.90 (10-year government bonds  yield is the blue line)

Hanzenko Anton