As we head into the back-end of the week, the US Dollar has experienced an aggressive sell off.
One interesting line I picked up in my morning reading was:
‘The US Dollar has now fully reversed all initial gains following the election victory for President Trump.’
This highlights the lack of confidence in the Trump administration that talked the talk of having the policies to boost economic growth, but so far has failed to walk the walk in delivering anything meaningful.
The latest political developments (which I’m not going to go into for obvious reasons but everyone has access to Twitter and Google), only continue to errode any confidence that markets once had in Trump’s election win being some sort of new dawn.
Just take a look at the US Dollar Index chart on your MT4 platform:
USDX Daily:
Thanks to these latest political developments, the USDX trend line break that we had been watching has followed through.
The question we have to now ask ourselves as traders, is will the market remain USD bearish, even if the Fed continues toward interest rate normalisation. That is, do you think that further Fed rate hikes that are definitely coming, will be able to provide any support for the USD?
Bonus Chart!
As long as we’re looking at the US Dollar, I thought it’d be worthwhile to also take a look at the S&P 500 chart:
S&P 500 Daily:
As you can see on the daily, at the moment it’s all about the gap fill.
Keep an eye on the the level and whether it acts as a magnet to essentially pull price down toward it.
