News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Take a closer look visually at the most influential global importers and exporters here: https://t.co/G58J1dg6y3 https://t.co/OiRiBVeuzL
  • Crude Oil Prices Aiming Higher on OPEC Surprise, Inflation Expectations - https://www.dailyfx.com/forex/fundamental/forecast/weekly/title/2021/03/06/Crude-Oil-Prices-Aiming-Higher-on-OPEC-Surprise-Inflation-Expectations.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Moss&utm_campaign=twr $CL #Crudeoil #OOTT #OPEC https://t.co/AKvXWX9DLQ
  • Given the size of the rally in the eleven months preceding the beginning of the current decline a broader sell-off looks warranted. Get your market update from @PaulRobinsonFX here: https://t.co/UxZiSulpwB https://t.co/raXvlzkGbV
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/lp0tmKS9WR
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/3bOSIBeID9
  • Rising yields and US Dollar creates a weak environment for gold, which trades at a 9-month low. Get your market update from @JMcQueenFX here: https://t.co/lh6Qb2qxin https://t.co/MRAYe57e1A
  • RT @FxWestwater: US Dollar Fundamental Forecast: US Dollar Eyes Inflation Data After NFP Boost Link: https://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2021/03/06/US-Dollar-Fundamental-Forecast-US-Dollar-Eyes-Inflation-Data-after-NFP-Boost.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr $DXY https://…
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/NvEAeWkBP1
  • The British Pound continues to face downside pressure as corrective trades continue. Get your market update from @HathornSabin here: https://t.co/YCctQSt2vB https://t.co/naVcnmf9UT
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/vABKiG4WNe
USD Price Outlook: US Dollar Volatility Eyes Year-End Flows

USD Price Outlook: US Dollar Volatility Eyes Year-End Flows

Rich Dvorak, Analyst

US DOLLAR OUTLOOK: USD PRICE ACTION FALLS BACK UNDER PRESSURE

  • USD price action faced renewed selling pressure throughout Tuesday’s trading session
  • US Dollar weakness was broad and notable against the Aussie and Sterling in particular
  • The DXY Index hovers around month-to-date lows as volatility dissipates into year-end
Advertisement

The US Dollar came back under pressure on Tuesday with USD price action weakening across the board of major currency pairs. This fueled a -0.4% decline by the broad-based DXY Index for the session and left the benchmark perched around month-to-date lows. US Dollar weakness was notable against the Aussie and Sterling with AUD/USD and GBP/USD gained 32-pips and 49-pips respectively.

DXY - US DOLLAR INDEX PRICE CHART: DAILY TIME FRAME (24 AUG TO 29 DEC 2020)

DXY Index Price Chart US Dollar Technical Forecast

Chart by @RichDvorakFX created using TradingView

US Dollar bears look to be back in the driver seat after wrestling back control of short-term direction. This is indicated by the DXY Index on pace for a close below its 8-day simple moving average. Despite the latest resumption of selling pressure across USD price action, which caused the DXY Index to tumble below the 90.00-handle again, US Dollar bulls might make a stand around the 17 December swing low.

EUR/USD BEARISH
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 8% -10% -1%
Weekly 26% -10% 6%
What does it mean for price action?
Get My Guide

This potential area of technical support is underpinned by its bottom Bollinger Band. Breaching this level, however, could tee up an acceleration in bearish momentum and prime the relative strength index for another plunge. A relief bounce toward the 91.10-price level could come into play if the US Dollar Index can surmount its negatively-sloped 20-day simple moving average.

USD PRICE OUTLOOK - US DOLLAR IMPLIED VOALTILITY TRADING RANGES (OVERNIGHT)

USD Price Chart Outlook US Dollar Implied Volatility Trading Ranges GBPUSD AUDUSD

Learn more about implied volatility trading strategies!

Realized currency volatility has been subdued over the last few trading sessions largely owing to the winter holiday season, but according to overnight US Dollar implied volatility readings, market activity is expected to pick up for the final full session of 2020. That said, it is worth noting that swings across USD price action could be exacerbated by rebalancing flows as traders position for the new year.

USD Forecast
USD Forecast
Recommended by Rich Dvorak
Get Your Free USD Forecast
Get My Guide

Whether or not the Senate agrees to increase direct coronavirus aid payments from $600 to $2,000 is another key theme worth keeping on the radar. Though passing the bill seems to be the less likely scenario, an aggressive spike lower by the US Dollar could materialize if the legislation is approved by both chambers of congress.

Keep Reading - Canadian Dollar Price Outlook: USD/CAD, GBP/CAD Levels to Watch

-- Written by Rich Dvorak, Analyst for DailyFX.com

Connect with @RichDvorakFX on Twitter for real-time market insight

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES