Wall Street had a bit of fear in the air today as the sell-off in equities ramped up. However, the USD did fall away a touch, there was no panic in forex markets.

The story of the day was really around the big fall in stocks. Tech stocks weighed on US markets as the NASDAQ was off more than 4%.

Experts are suggesting that markets are finally starting to price in the fact that interest rates are rising and that will potentially limit growth going forward. At the same time, the Chinese tariffs will certainly raise costs for consumers and that will undoubtedly lead to some level of inflation.

The USD/CAD jumped the most on the day, while oil was also off 2.5%.

The USD Outlook

The DXY fell away a touch and the resistance level at 96.20 is the short-term top for now. We are currently sitting right on support at 95.50, but I don’t feel that there is necessarily a heap of pressure to the downside just yet.

There isn’t a heap of support below this point so if we do actually get moving lower then we could well sell-off. 95.00 will see some buying but it hasn’t been a big level in recent times.

Really it is 94.00 that is the next big level below in my opinion.

At the time of writing the yield on the 10-year is sitting at 3.195, which is about 0.5% lower on the session.