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US Dollar Rallies Despite Central Bank Concerns

The US Dollar regained strength on Thursday, reversing earlier losses triggered by concerns voiced by central banks about its recent dominance. This resilience highlights prevailing US economic outperformance.

Key Factors:

  • Robust US Data: Strong Jobless Claims and Philadelphia Fed Manufacturing Survey data boost the USD, reinforcing market expectations for higher US interest rates.
  • Central Bank Worries: Despite concerns expressed by the ECB, Japan, and South Korea about the USD’s impact on their currencies and inflation, the fundamental outlook for the USD remains positive.
  • Fed Speakers and Data: Upcoming economic indicators and comments from Fed officials could further fuel the USD’s momentum.

Technical Analysis:

  • Rate Hike Sentiment: Comments hinting at potential rate hikes rather than cuts add fuel to the USD’s rally.
  • Key Resistance: The USD could face resistance at 106.52 (recent high) and potentially 107.35 (October 3 high).
  • Support Levels: Initial support lies at 105.88, followed by 105.12 and 104.60. The region containing the 55-day and 200-day SMAs (104.17 and 103.91) offers additional support.