Greenback Holding For Now
Today’s Spotlight Market
The US Dollar Index rebounded from six-month lows after testimony from Fed Chair Janet Yellen said the US economy is poised for growth.? Whether the greenback will be able to gain traction from economic growth remains up in the air.? This could simply be a temporary reprieve from the recent wave of selling pressure.? The firmness in prices may be seen as much technical in nature as much as news driven due to oversold conditions.
Fundamentals
The US Dollar got a bit of a boost from softer March German manufacturing data, which showed regression.? New orders fell 2.8% in adjusted terms versus forecasts of a 0.2% increase in orders.? The ECB held interest rates steady at 0.25%.? There is some speculation that the ECB may go in the opposite direction of the Federal Reserve and begin asset purchases to weaken the currency.? The Fed continues to be an enigma, not committing to an interest rate timetable.? It is widely believed that the Fed will completely eliminate asset purchases by the end of the year, which will remove some money supply.
Technical Notes? -? View Today’s Chart
Turning to the chart, we see the Dollar Index breaking down below support near the 79.25 mark.? The downtrend that began last year continues and the Dollar Index now finds itself at a particularly important level ? support at the 79.00 mark.? Failure to hold here could result in a tidal wave of selling pressure.? As previously mentioned, the RSI indicator is showing oversold conditions, which could be seen as supportive in the near-term.
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