The US Dollar Index (DXY) is mildly trading up at 104.45 on Thursday as sellers seem to be consolidating the sharp downward movement from Wednesday's session. The US economy is hinting toward a slowdown, evidenced by the unexpected Initial Jobless Claims rise and a Philadelphia Fed Manufacturing Survey contraction. Softer-than-expected inflation data reported on Wednesday supports this idea, which makes markets hope that the Federal Reserve (Fed) might consider rate cuts sooner rather than later, a thesis that weakens the USD.
EUR/USD eased slightly on Thursday, falling back below 1.0880 as the Greenback broadly recovers losses from earlier in the week. The pair remains up for the trading week, but a late break for the US Dollar is on the cards as investors second-guess the Fed's stance on rate cuts.
The GBP/USD pair posts modest gains near 1.2670 during the early Asian session on Friday. Meanwhile, the USD Index recovers some lost ground after retracing to multi-week lows near 104.00 in the previous session.
USD/JPY rose to near 155.90 during the Asian session on Friday as the Japanese Yen encountered renewed pressure. This was sparked by the Bank of Japan maintaining its bond-buying amounts from the previous operation, opting against a surprise cut to debt purchasing earlier in the week.
Gold price trades with a bearish bias on Friday after retreating from the nearly $2,400 barrier. The bullish move of precious metals in the previous sessions was bolstered by the softer-than-expected US inflation data in April, which triggered hope for rate cuts from the US Federal Reserve.
Western Texas Intermediate, the US crude oil benchmark, is trading around $78.90 on Friday. The black gold edges higher amid the recent drop in US crude inventories and the possible interest rate cuts by the Federal Reserve.
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When I write the Online Trading Academy Forex newsletter, I give my opinion about what I believe is happening to the currencies of the world based on the news I hear, the experts I follow, and my personal experiences of the economic cycles I have seen in the past. This fundamental information helps me understand what reports and indicators the economists of the world believe will shape future events.
Have you watched the US Dollar Index (USDX) Futures contract trade during the day? Do you notice that with each price change the intervals are always a minimum tick of .005? And then at the end of the day when you look at your daily candle of the USDX you see a closing price like 97.197.
Over the last few months especially, there’s been a lot of focus in the world of Currency Trading upon the state of the US Dollar. No matter what your opinion is of the Greenback, it is still, without question, regarded as the world’s primary reserve currency and holds its weight of recognition across the board.
