The US dollar continue declines 📉
The EURUSD pair is trading today at levels not seen since the first half of August, at 1.0327, and has climbed above the 200-session moving average on the daily interval, signaling a potential reversal of the downward trend:
- The European currency strengthened against the U.S. dollar on a wave of yesterday's declining U.S. inflation reading and comments from Fed members that signaled an impending lower rate hike;
- Today's data from the University of Michigan came in well below analysts' expectations and pointed to weakening demand in the US economy;
- Speculation around a potential peak in U.S. inflation and a peak in the Federal Reserve's 'aggressive monetary policy' spiked risk assets and drove investors away from the dollar, helping the euro to strengthen.
EURUSD, D1 interval. The RSI relative strength index for EURUSD climbed around 69 points, beating the previous one-year highs in September and climbing to levels not seen since mid-2021. Source: xStation5
