Markets on Thursday: USD On a Tear – More Upside Ahead
Rowan Crosby • 1 min read
The ongoing story for most traders in the forex world is what exactly is going on with the USD. No doubt the Greenback has been on the slide in recent times, but Wednesday might just be the first sign of life we’ve had in some time.
The DXY spiked higher, helped by some strong data out of the US. The big one was really US GDP, which came in at 2.9%. Expectations were for 2.7%. And let’s not forget the target rate of 3% is where we’re looking to get to. So for the most part, the Fed would really like what they saw.
That might just mean we have enough room to move on that fourth interest rate hike this year.
The rising dollar put the majors under all sorts of pressure. The EUR/USD fell sharply along with the AUD/USD. While the USD/JPY really broke higher, thanks also to a falling JPY.
Bitcoin appears to be losing the battle against overhead resistance as it just can’t poke its head much higher than 8,000.
The DXY might have been 0.85% higher on the day, but we won’t get too carried away just yet. We’ve settled just above 90.00, but the real test will come at 90.50.
That’s a level we have been yet to crack, but now that the fundamentals are helping us along we might well have a better chance this time around.
At the very least I’m now expecting a test of that level and will be looking to trade the majors with that bias in mind on Thursday.
US Dollar Index (DXY)- 240 min Chart.