Dollar Forex Market Sell-Off Continues in Early Trading
The US dollar has already started the week with weakness against most major currency pairs in the forex market. This weakness continued today as no major events were announced on the economic calendar that would have put the currency at the mercy of optimistic market forecasts. This forecast has been extended to COVID cases in the US, where a further downward trend is expected. Despite these positives, markets opened slightly higher and even slightly below record highs.
The dollar continues its downward movement Still
The greenback continues to give the impression that other major currencies are strong today, largely at the expense of its own lack of strength. The U.S. Dollar Index continued to fall sharply to 91 points as currency market traders continue to try to look past the current difficulties. The EUR/USD also broke through the 1.20 level and reached its highest level since early March. This is despite the fact that EU data did not meet expectations.
Another factor keeping the USD under pressure is the fact that US Treasury yields remain lower than 1.60% at today’s market opening. This should generally contribute to a sense of risk aversion, although it is not being felt on Wall Street today.
holder expects further decline in Aheadcase
Former FDA chief Dr. Scott Gottlieb said he expects the number of coronavirus cases to continue to decline in the coming weeks, which added fuel to the fire of positive sentiment among currency traders. Although the number of cases remains higher than at the end of last month, the latest weekly data shows that the number of new cases is returning to previous levels.
Dr. Gottlieb believes this trend will continue in the coming weeks and months, as summer approaches and more and more people begin to spend time outdoors. In addition, the fact that all American adults are now eligible for the COVID-19 vaccine will undoubtedly accelerate the decline. The new government has further reduced vaccination targets. More than half the population now receives at least one dose, according to the CDC. News that the FDA plans to resume production of Johnson & Johnson’s vaccines was also well received.
Positive market prospects
Wall Street markets started the week with a quiet opening. This may come as a surprise as the exchange rate figures, including the strength of the dollar, point to a sense of risk-off. The NASDAQ is down more than 100 points, with technology leading the losses so far. The Dow Jones and the S&P also fell from their previous highs.
Despite the nervous opening, markets are close to all-time highs after a week of impressive gains. For many analysts, sentiment is still positive and they believe there is still room for improvement now that the recovery of the economy is within reach.
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