DXY invigorated by Fed's Yellen remarks
The US Dollar continues to find further demand as Fed's Chair Janet Yellen makes her appearance in a speech titled "Inflation, Uncertainty, and Monetary Policy" at the National Association for Business Economics Annual Meeting, in Cleveland. The US Dollar index reached new daily highs circa 93.30, although strong offers sitting just above capped the rise, leading to a retracement towards the 93.00 round number.
Yellen reveals a slightly more hawkish posture
The Greenback saw an initial retracement, only to fade its move lower and successfully complete a V-shape reversal taking the currency into fresh highs across its main peers. Finding further follow-through might represent a challenge though, as EUR/USD has already reached its daily ATR (14-period). While Yellen didn't seem to bring any major updates on monetary policy when compared to last week's FOMC headlines, there was a new hawkish catch, noting that "the FOMC should be wary of moving too gradually", implying that the pace of rate increases might potentially be faster than anticipated. The comment, which came via Bloomberg, was enough to add gas to the USD tank. Another hawkish remark read "it would be imprudent to keep monetary policy on hold until inflation is back to 2 percent."
DXY keeps building on its bullish momentum
From an hourly perspective, the last candle just closed printed an outside reversal, as the price heads back down towards the 93.00 handle, where bids are expected to be found ahead of 92.65/70 - triple top broke earlier today - ahead of further support at 92.50 - mid round number -. The bullish run initiated off 91.80 back on Sept 22nd has seen strong momentum behind, suggesting that any dips into key support areas should see buying interest. On the upside, the next area of resistance, should 93.30 be cleared, can be found at 93.50 ahead of 94.00.
Author
Ivan Delgado
Independent Analyst
Established in the Asian continent since 2009, Ivan studied a degree in Business at the University Pompeu Fabra (Barcelona), while also earning a postgraduate degree in Business Administration.
