Dollarstrength
GBPUSD SELL AN IDEA BY NNA TRADING AND PORTFOLIO MANAGEMENT
SCALP ON THE WAY DOWN
1836 PIP TP
1-11 RISK TO REWARD
DOLLAR (W)The U.S. dollar after a consistent decline since the FOMC Policy is now witnessing some mild bullishness to post a rebound following a long stretch of declines. The Fed meeting minutes released lately shows that officials factored in the tax cuts. While tax cuts were one of the factors that led the central bank to hike interest rates in December. Inflation, however, is expected to remain below the Fed's target for longer.
Higher timeframe charts are clearly highlighting that the Dollar Index has been fighting a tough battle in holding off the supports. At the moment the support level is being cautiously held as overall sentiment remains muted on the Dollar. price break and close below 91 develops. We continue to maintain that situation could improve only when the DX starts moving above 93.50 till then it’s a tough call for the basket. The negative DI is seen inching higher while the prices are seen stalling. DX is seen under pressure and is now coiling once again towards a trended scenario once again and this could now translate into some rangebound action for the next few days.
Dollar Index WDollar Index has been witnessing a freefall and the fall beyond critical supports around 94.30 mentioned in the last issue lead the DX lower. Currently, the U.S. currency's performance against the euro and five other currencies, hit its lowest level since May 3, 2016. The sharp weakness not witnessed since the period of January to July 1986 is driven by disappointing economic data, political uncertainty and positive developments abroad have sent the U.S. dollar lower despite two rate hikes by the Federal Reserve. The recent selling seems to be overdone and hence a stronger U.S. dollar rebound from current levels are expected by year-end 2017.
