After yesterday’s dollar fall and breakouts, the greenback made a small recovery. At the start of the New York session, the dollar tumbles again. For some currencies, this means erasing the dollar’s gains. But for EUR/USD – this means new ground. The US dollar index is at new lows.
Yesterday’s European session pushed most currencies out of long term ranges. EUR/USD was the strongest example, after AUD/USD and NZD/USD already showed the way with early breakouts. Also the Swissy and the loonie reached new ground, and only the Pound stayed behind.
There were doubts regarding the breakout of EUR/USD. Will it hold? Is it real? After hovering in the new ground of around 1.45 but not too far from the support line of 1.4444, EUR/USD proved that the breakout is mighty strong.
New Breakouts and Corrections
EUR/USD now trades at 1.4560, leaving the old line behind. The target price of 1.4720 looks more real today. Casey Stubbs looks on the next steps in the path of EUR/USD.
Also USD/CHF is at new lows, 1.0420. NZD/USD made small gains from yesterday’s peak, reaching 0.6997. The magical number of 0.70 scared it at the moment.
Most currencies just returned to yesterday’s gains and didn’t advance: AUD/USD returned back up to 0.8640, USD/CAD is far from yesterday’s levels due to very weak Building Permits, and is now at 1.0780.
The Pound is still behind, trading at 1.6530, far from 1.6660.
US Dollar Index Lows
Apart from the Euro (and the Swissy), the notable thing that makes this move a significant second wave of dollar weakness this week is the US Dollar Index. It went below 0.77 in a sharp move, breaking yesterday’s one year lows.
Will these big waves of dollar weakness continue? What do you think?