State of the Market: the US dollar is traded in a narrow range

On Wednesday, the US dollar index remains near the maximum of February on optimistic comments made by the US Federal Reserve Chairman Powell. Thus, the speech of the head of the Federal Reserve was very optimistic for the US currency, which was caused by the statement in the future to continue to tighten the monetary policy of the US, despite the reduction of taxes and the growth of public debt. However, Powell did not say about the specific number of rate hikes and their terms, but the tone of the speech indicated the possibility of a fourfold increase in rates in the US this year.

The growth of the US currency provoked the collapse of global stock exchanges, which intensified on weak data on business activity in China. As a result, the dynamics of investors’ flight from risks is traced in the market, which is likely to continue with the negative opening of trading on European stock exchanges.

The US dollar index against the basket of major competitors remains under the resistance zone 90.40-50, which limits the development of the “double bottom” figure.

Graph of the US dollar index. The current price is 90.20.

Hanzenko Anton