Dollar Falters in Unusual Forex Week


In the forex market, the upcoming week anticipates limited activity due to a light economic calendar and holiday-thinned trading. Most platforms will be non-functional on Monday, potentially leading to false breakouts. Equities performed well, with the Dow Jones hitting all-time highs, while US Treasury yields fell to 3.90%, the lowest since July. The US Dollar Index (DXY) remained bearish below 102.00, influenced by risk appetite and lower yields. The week’s key indicator, Core PCE, rose 0.2%, below the expected 0.3%, contributing to the dollar’s decline. Next week’s US data includes home prices, jobless claims, and the Chicago PMI.

EUR/USD surpassed 1.1000, aiming to sustain this level, marking the highest weekly close in five months. GBP/USD saw modest gains but struggled above 1.2700 due to softer UK inflation. The Japanese Yen weakened after the Bank of Japan’s meeting, with USD/JPY ending below the weekly peak at 142.50. BoJ’s Summary of Opinion and economic data, including retail trade and industrial production, will be key. Canada, Australia, and New Zealand lack significant economic reports, with AUD/USD and NZD/USD posting gains. USD/CAD dropped below 1.3300, marking the lowest close since August.

Gold achieved its second-highest weekly close, hovering around Dollar 2,050. The bullish trend faces risks from a potential Fed easing repricing, with a rebound in US yields posing a threat. The forex landscape awaits crucial economic releases and central bank actions, with global dynamics steering price actions in the upcoming week.

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Daniel Martin
Daniel Martin is a highly accomplished forex trader from the United States. He has over 15 years of experience, and has gained a reputation for his exceptional insights and consistent profitability in the foreign exchange market. Born and brought up in New York, Daniel holds a degree in Economics and has a deep understanding of market dynamics. He is known for his disciplined approach, ability to interpret market patterns, and expertise in various trading strategies. Daniel actively shares his knowledge through articles, webinars, and seminars, and is committed to promoting ethical trading practices. With his passion and extensive experience, he continues to guide individuals towards financial success in the dynamic world of forex trading.