FOREX: Broad Greenback Pressure Prompts Fresh Cycle Lows for USD Index
Apr-10 18:45
- Thursday’s session was categorised by some sharp reversals lower for both US equities and the US dollar. While major US equity benchmarks have not entirely erased the prior session gains, the USD index has, and the ongoing pessimism towards the greenback has prompted the USD index to print fresh cycle lows below 101.00. Weakness was assisted by a set of softer-than-expected CPI data from the US.
- With the broad greenback weakness really gathering steam, this allowed EURUSD (+2.66%) to trade above the 1.12 handle for the first time since September last year. Importantly, a cluster of daily highs around this mark have been breached, most notably at 1.1214, the Sep 25 high. Above here, 1.1276 represents the 2023 highs for the pair.
- Meanwhile, it is the Swiss Franc which continues to screen as the best performing currency in G10, now up 3.9% against the dollar as we approach the APAC crossover. USDCHF has broken the 2023 lows at 0.8333, of which downside momentum has been exacerbated on the break. The pair currently trades at fresh ten-year lows of 0.8238 and below here, markets will look to 0.8099, the 76.4% retracement of the Jan 15 '15 - Dec 15 '16 recovery.
- USDJPY traded to within 2 pips of Wednesday’s 144.00 low, which has managed to cap the downside for now. Overall, this week’s move below 144.56, the Apr 4 low and bear trigger keeps the market’s attention on the significance of the technical break, which confirms a resumption of the downtrend. Below here markets will look to 143.43 - Low Oct 2 ’24.
- Friday’s calendar highlights include UK activity data and US PPI figures.
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