This is a US Dollars Index (DXY) Technical Analysis on a Forex Blog.
US Dollar Index (DXY) – On the weekly time frame, we see this pair going lower.
Technical indicators are still showing bearish momentum for the greenback.
The recent tumbling of the greenback have been attributed to weaker than expected inflation data on Friday.
However, if you look at the chart, it seems that the greenback have been falling for quite some time already. It seems that the market is no longer seeing Trump in the light that they use to when he was just elected in as the US President.
In fact we can say that the market have been rather “disappointed” with the way his administration is managing things.
Many in fact were expecting huge stimulus from the Trump administration at the start of this year. They were waiting for maybe a tax cut and maybe announcements of infrastructure spending. Not only are they absent, now Congress is arguing over health care at the expense of the American people and the insurers too as they cannot be sure of what is going to happen in the end.
If the health care debate does not end, we can be sure that the economic agenda will not start either.
Why? Because half of the cuts in the health care expenditure is suppose to fund the tax cuts that are going to be proposed.
With the issues that I have mentioned and the recent data coming out kinda weak, I do not expect the Fed to increase rates anytime soon.
This doesn’t bode well for the US dollars and with the UK, ECB and BOC being more hawkish, we can expect more greenback weakness going forward,
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