Markets on Wednesday: The USD Tumbles To Get the Year Rolling
Rowan Crosby • 1 min read
The first day of trading for the year was an eventful one and it was lead by none other than the USD. The Dollar took an absolute hammering which put the majors in focus and helped commodities find some strength.
The majors were active across the board, with the USD/CAD sliding and the AUD/USD performing well. The EUR/USD has kept its rally going to start 2018 and we now have to start asking questions about the USD.
Commodities were all grinding higher, lead by gold who has been on a big bull run recently along with Oil.
What’s Going to Stop the USD?
Ever since tax reform passed in the US, the USD has fallen away in a big way. There is no doubt that reducing taxes is only going to boost the dollar in the long-term, however, for now, it is clear that much of those gains have been already factored in.
The DXY has kept on taking out support levels and I am looking for an area where we might turn things around. 91.70 is the area most likely to hold up in the short-term and then below that 91.00. However, the momentum is strong at the moment and it certainly isn’t worth fighting the trend.