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The post-Fed sentiment was the catalyst for the newest leg greater within the greenback this week. Powell & co. provided a extra hawkish tilt and that was sufficient to see markets scramble to cost in 5 charge hikes by the Fed this 12 months.
In flip, the greenback has surged greater as yields additionally climbed – each benefiting from the above sentiment.
With the greenback scaling to new highs since July 2020, the charts are additionally telling the story that it’s powerful to actually guess towards the buck in the mean time. Let’s have a look.
EUR/USD has fallen to its lowest since June 2020 and regardless of a pause within the drop for now, there is not a lot assist standing in the way in which of an additional push in direction of 1.1000 from right here. That gives loads of room for sellers to roam within the meantime.
In the meantime, GBP/USD has fallen fairly quickly in latest days as sellers solidify a break beneath the 100-day transferring common (purple line). The drop yesterday fell beneath 1.3400 and though patrons are holding up for now, there won’t be a lot respite till a push in direction of 1.3200 doubtlessly.
As for USD/JPY, the pair is driving excessive once more as Treasury yields roar again. The 116.00 deal with will likely be key to look at once more and a break may precipitate a transfer in direction of 118.00 in a while.
Elsewhere, commodity currencies proceed to come back beneath stress as shares are additionally languishing. AUD/USD is closing in on a check of 0.7000 subsequent whereas NZD/USD sees little assist till 0.6500 doubtlessly:
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