The American currency is actively declining during the trading session on Wednesday. The USD (DXY) index has lost 0.17% since the opening of the day and came close to the support at 90.00. In the event that this level falls, the next target for sellers will be the minimum from 2018 at around 98.00.
Investors are selling off the US currency ahead of the publication of the final minutes of the two-day Fed meeting, which will be released at 21:00 Moscow time. Additional pressure on the dollar is exerted by the US macroeconomic statistics published yesterday. Thus, the volume of industrial production in November decreased from + 0.9% m / m to + 0.4% m / m.
First of all, the dollar sell-off is due to expectations of additional stimulation of the economy in the form of a potential easing of the FRS policy and the approval of a new stimulus package by Congress. Recall that another version of the package of emergency measures to stimulate the growth of the American economy was presented to the US Congress last Monday. The bill was prepared by a group of members of the Senate of Congress, representing both the Democratic and Republican parties. The document consists of two parts: a package of measures for $ 748 billion, on which an agreement was reached, as well as a separate package for $ 160 billion, on which lawmakers from both parties have not yet agreed. The second part includes the allocation of additional funds to combat the pandemic to the state authorities, which the Republicans oppose. The first part of the bill includes an increase in federal unemployment benefits, an increase in funding for education, as well as funds for the production and distribution of coronavirus vaccines throughout the country. Thus, according to the idea of the authors of the initiative, there is a high probability that Congress will approve at least the first part of the bill.
In addition, markets are responding to increased quarantine measures around the world, even as optimism about COVID-19 vaccines remains. In particular, at the beginning of the week, the mayor of the city, Bill de Blasio, spoke about the possible closure of New York for a full-fledged quarantine, who noted a noticeable threat to city health due to the high rate of morbidity. With that said, the DXY sell-off is likely to continue.
DXY SellLimit 90.60 TP 88.00 SL 91.10
Analytical reviews and comments to them reflect the subjective opinion of the authors and are not a recommendation for trading. Author Artem Deev is a trader analyst at AMarkets . The social network of traders is not responsible for possible losses in case of using the review materials
:
Forex news → How to make money in the foreign exchange market today! Trading ideas for traders 03.12.2020: GBPUSD What will happen to the pound?
Forex news → How to make money on the foreign exchange market! Trading ideas for traders 11/26/2020: EUR/USD is about to hit 1.20!
Forex news → How to make money on Forex today? Trading goes traders 09/23/2020: Steam and GBP / JPY - another candidate for the medium-short!
Forex Analytics → Nicholas Korzeniowski - Trading Ideas October 2016. Systemic risk in German.
Forex news → How to make money in the foreign exchange market today! Trading ideas for traders 03.12.2020: GBPUSD What will happen to the pound?
