24 Sep 2013
US Dollar index extends the recovery
FXstreet.com (Edinburgh) -The greenback, gauged by the US Dollar Index, is inching higher on Tuesday and extending its correction higher to the area beyond 80.50.
DXY paring losses
The greenback continues to trim the sharp sell-off post FOMC meeting, prolonging its bounce off the key support at 80.00. Increasing risk-off trade has benefited the USD since then, as the US fiscal debate is growing in presence amongst traders and promises to be not a minor factor in the upcoming days. Jane Foley, Chief Strategist at Rabobank, assessed, “While the decision by the FOMC not to taper last week was initially met with a boost to risk appetite, the expectation that the Fed has just delayed an inevitable decision has limited investors’ enthusiasm for risk. Going forward US economic data will be key in determining both the pace of the US economy and the timing of the Fed’s first tapering decision. Our view is that the Fed will start reducing the size of its asset purchases in its December meeting and that this should coincide with a better tone for the USD”.
DXY levels to watch
The index is now up 0.08% at 80.53 with the initial resistance at 81.35 (high Sep.17) followed by 81.93 (high Sep.11) and finally 82.50 (high Aug.2). On the flip side, a break below 80.06 (low Sep.18) would open the door to 79.49 (low Feb.6) and then 78.93 (low Feb.1).
DXY paring losses
The greenback continues to trim the sharp sell-off post FOMC meeting, prolonging its bounce off the key support at 80.00. Increasing risk-off trade has benefited the USD since then, as the US fiscal debate is growing in presence amongst traders and promises to be not a minor factor in the upcoming days. Jane Foley, Chief Strategist at Rabobank, assessed, “While the decision by the FOMC not to taper last week was initially met with a boost to risk appetite, the expectation that the Fed has just delayed an inevitable decision has limited investors’ enthusiasm for risk. Going forward US economic data will be key in determining both the pace of the US economy and the timing of the Fed’s first tapering decision. Our view is that the Fed will start reducing the size of its asset purchases in its December meeting and that this should coincide with a better tone for the USD”.
DXY levels to watch
The index is now up 0.08% at 80.53 with the initial resistance at 81.35 (high Sep.17) followed by 81.93 (high Sep.11) and finally 82.50 (high Aug.2). On the flip side, a break below 80.06 (low Sep.18) would open the door to 79.49 (low Feb.6) and then 78.93 (low Feb.1).