Is the Dollar's Downtrend Continuing?
20 November 2023
Hello traders, welcome to Monday! Following a remarkably bullish week for stocks and a tough one for the U.S. dollar, let's dive into what's unfolding in the markets today.
Starting with the macroeconomic calendar, it's a quiet Monday with no major data releases scheduled. The only notable event is a speech by Bank of England Governor Bailey later in the day.
Shifting to the currency market, we're seeing interesting movements among the antipodean currencies. The Australian and New Zealand dollars are starting the week strong, followed closely by the Japanese Yen. In contrast, the U.S. dollar is the weakest currency this morning, continuing its recent downtrend. EUR/USD is touching the highest levels of the month, revisiting late August's peaks, while USD/JPY hovers around a crucial support at 148.8. A break below this point could trigger a selling signal.
In the realm of commodities, there's a positive trend across the board. Gold, silver, and oil are all on the rise, with oil particularly trying to reverse its previous week's losses. This uptick began last Friday and seems to be gaining momentum.
As for indices, despite a bullish previous week, we may see a bearish opening today as traders likely take profits. This is particularly notable in NASDAQ, which after reaching mid-July resistance levels, might experience a slight correction.
To sum up, today's market is shaped by the continued weakness in the dollar, strong performance in commodities, and a potential slight pullback in indices after last week's gains.