Weekly Trading Forecast: Dollar Solidifies Its Dominance, Surges to 12-Year Highs
The Dollar's fundamental appeal has simmered through 2015, but that strength came straight to the forefront following strong NFPs. The repercussions of this performance will stretch further than just the Dollar...and FX.
Eight months of congestion have been brought to a dramatic endthis past week as the US Dollar mounted an impressive rally in the aftermath of the October labor report.
While EUR/USD could see further downside pressure as markets continue to price in a December rate hike, other EUR-crosses may find some pause as investors seek to reexamine the central bank stimulus backdrop over the coming weeks.
GBP/USD stands at risk of extended the decline from the beginning of the month should the key developments coming out of the U.K./U.S. largely boost speculation for the Federal Open Market Committee (FOMC) to normalize monetary policy ahead of the Bank of England (BoE).
The Japanese Yen finally showed signs it might break its long-standing trading range as it fell to multi-month lows versus the resurgent US Dollar.
Just last week we reiterated our bearish forecast for the Canadian Dollar on the basis of expected weakness in Oil prices.
The Australian Dollar looks vulnerable to deeper losses as domestic and external news-flow embellishes the expected divergence between RBA and Federal Reserve monetary policy.
Gold prices plunged for a third consecutive week with the precious metal down more than 4.7% to trade at 1088 ahead of the New York close on Friday.
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