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13 Sep 2013
US Dollar index retakes 81.60
FXstreet.com (Edinburgh) -The greenback, gauged by the US Dollar index, is posting gains for the second consecutive session on Friday, regaining the boundaries of 81.60.
DXY propped up by risk aversion
The greenback is reverting the recent steep decline sparked after softer-than-expected August’s Payrolls, recovering the 81.60 region as the risk aversion is back amongst traders. Rumours that Larry Summers could be the next Fed’s President are also doing the rounds and supporting the USD somehow. In the same direction, the effervescence in the Middle East looks set to resume after talks between Russia and US seem to go nowhere. In light of next week’s FOMC meeting, the research team at BTMU assessed, “We expect the Fed to begin gradually tapering QE perhaps by slowing monthly asset purchases by USD10 billion. It would be a negative surprise for the US dollar if the Fed did not begin to taper QE given that it has not signaled any discomfort over current market expectations heading into the meeting. There has also been some speculation that the Fed may strengthen its low rates commitment with rates unlikely to rise until the unemployment rate reaches 6.5%, which is weighing upon the US dollar”.
DXY levels to watch
At the moment the index is advancing 0.12% at 81.62 with the next resistance at 82.50 (high Aug.2) followed by 82.67 (high Sep.5) and then 83.02 (high Jul.18). On the downside, a break below 81.10 (low Aug.27) would expose 80.86 (low Aug.8) and finally 80.75 (low Aug.20).
DXY propped up by risk aversion
The greenback is reverting the recent steep decline sparked after softer-than-expected August’s Payrolls, recovering the 81.60 region as the risk aversion is back amongst traders. Rumours that Larry Summers could be the next Fed’s President are also doing the rounds and supporting the USD somehow. In the same direction, the effervescence in the Middle East looks set to resume after talks between Russia and US seem to go nowhere. In light of next week’s FOMC meeting, the research team at BTMU assessed, “We expect the Fed to begin gradually tapering QE perhaps by slowing monthly asset purchases by USD10 billion. It would be a negative surprise for the US dollar if the Fed did not begin to taper QE given that it has not signaled any discomfort over current market expectations heading into the meeting. There has also been some speculation that the Fed may strengthen its low rates commitment with rates unlikely to rise until the unemployment rate reaches 6.5%, which is weighing upon the US dollar”.
DXY levels to watch
At the moment the index is advancing 0.12% at 81.62 with the next resistance at 82.50 (high Aug.2) followed by 82.67 (high Sep.5) and then 83.02 (high Jul.18). On the downside, a break below 81.10 (low Aug.27) would expose 80.86 (low Aug.8) and finally 80.75 (low Aug.20).