Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Where Will The Current Wave Of Decline Take The Dollar?

By FxPro Financial Services Ltd (Alexander Kuptsikevich)ForexApr 19, 2021 06:47AM ET
www.investing.com/analysis/where-will-the-current-wave-of-decline-take-the-dollar-200573861
Where Will The Current Wave Of Decline Take The Dollar?
By FxPro Financial Services Ltd (Alexander Kuptsikevich)   |  Apr 19, 2021 06:47AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The US Dollar remains under moderate pressure at the start of the new week. The Japanese yen continues to recoup losses from the beginning of the year, with USD/JPY falling to 108.00 this morning, an area of four-week lows. GBP/USD is gaining for the sixth trading session in a row, trying to break above 1.3850 on Monday morning, where the 50-day moving average is.

USDJPY falling to an area of four-week lows.
USDJPY falling to an area of four-week lows.

GBP/USD and USD/JPY often rise during periods of high demand for risky assets and fall when investors gravitate to safe havens. We are now seeing a divergence in their dynamics due to the pressure on the Dollar.
 
Another barometer of risk demand, the USD/CNH, also turned down in April, acting as an indicator of investors' relatively complacent attitude towards emerging markets.
 
Such sustained pressure on the Dollar makes us think that its previous strengthening from January to March 2021 was just an upward correction of the May-December 2020 down-impulse within the general bearish trend.
GBPUSD is gaining for the sixth trading session in a row
GBPUSD is gaining for the sixth trading session in a row

Fundamentally, the dollar's climb since the start of the year has been supported by actual or planned bond auctions to fund a $1.9 trillion support package. Biden's $2.4 trillion Infrastructure Plan is promising to be a long-term project, already bumping up against bureaucratic hurdles. Thus, the actions of the US Treasury and President Administration are no longer pushing the dollar higher.
 
Rather, it's just the opposite. The Treasury has collected the money and is now handing it out to be spent on stock purchases or general consumption by households or business.
EURUSD could target 1.33
EURUSD could target 1.33

It is likely that we now see the beginning of a new impulse to weaken the dollar, compared to what happened from May to December 2020. As part of this momentum, EUR/USD could target 1.33, while GBPUSD could go as low as 1.55. USDJPY will swim against the tide in these conditions, so do not expect a renewal of the lows here, but only a pullback into the 102-105 area.

The FxPro Analyst Team

Where Will The Current Wave Of Decline Take The Dollar?
 

Related Articles

Where Will The Current Wave Of Decline Take The Dollar?

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Mehmet Dutlu
Mehmet Dutlu Apr 19, 2021 10:22AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
this is a wishful thinking not based on technical indicators.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email