US Dollar May Take Some Short-Tem Gains
Our currency expert Gabriel André chimes in on the latest with the US dollar…
“Selling pressure dominated the greenback between February and mid-March (take a look at the Dollar-Index chart below). The US dollar fell by 8% against major currencies. Traders will take note of this technical move…technicals help them establish where the market is moving in the short term.
“But following that hefty sell-off, the US dollar has traded in a tight range for the last two weeks, as I’ve outlined with the two diagonal lines below. Traders are waiting for a sniff, a hint of something fundamental…they want a little more info before making their next play. There hasn’t been anything decisive for a while on the US economy.
“This absence of data could give the dollar a leg-up in the short term. It’s good timing for a retracement. You could see the US dollar shift back up to its red moving average. That would mean a move to 73.8 on the chart. And if it gets up enough steam, it could possibly go all the way to the black line just below 75.
“Be wary…another bad unemployment report or sickly housing data could see the bearish trend return. But until then, traders have reason to push the dollar up.”