The USD Holds as Trade Tensions Erupt
Rowan Crosby • 1 min read
Just when we thought we could put the trade wars to bed once and for all they have again reared their head. Although the USD shook off too many concerns.
Wall Street, on the other hand, wasn’t so lucky. What had been a strong start for equity markets quickly turned around as the sellers came thick and fast. Pushing the major indices into a close in the red.
The next round of tariffs are likely to come into play if talks break down between the US and China this time around.
Oil also continued to fall and the energy players all fell away sharply. So keep an eye on that as oil continues to be bearish.
Meanwhile, Angela Merkel has suggested she won’t seek reelection. While this isn’t necessarily a market mover, it might appease some in Europe. Depending on your political opinions.
The USD Outlook
The DXY held up well yesterday and the resistance level turned support at 96.20 hasn’t been challenged.
That gives me confidence that a test of 97.00 isn’t that far off. The USD held up OK during the worst of the trade wars hype so the second time around, perhaps won’t be so bad.
As mentioned yesterday, the USD will likely be a lot more focused on the jobs report on Friday in the short-term.