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9 Dec 2014
The US Dollar index falls 1%
FXStreet (Mumbai) - The Greenback declined across the board today as the treasury prices gained on safe haven demand, pushing the yields lower.
The US dollar index trades 1% lower at 88.20 levels, compared to the previous session’s close of 89.05 levels. The EUR, with the highest weight of 57.6% in the dollar index, has gained 0.91% against the US dollar to trade at 1.2426 after the European Central Bank data showed a slowdown in the weekly asset purchases. Furthermore, the EUR also benefited from the declining US-Eurozone bond yield spreads.
Meanwhile, the Japanese Yen with a second highest weight of 13.6% in the dollar index, has gained 1.73% to trade at 118.62 levels per US dollar. The yen gained as the risk aversion in the financial markets led to the unwinding of risk-on trades initiated post the Bank of Japan’s surprise expansion of stimulus on Oct 31st.
Other components of the dollar index like the British Pound, Swiss Franc and Swedish Krona have posted modest gains against the greenback. The British Pound has been able to gain strength despite the disappointing Industrial production data released earlier today.
The US dollar index may continue to extend slide as the two major components - JPY and EUR – are likely to extend gains on safe haven appeal and declining treasury yields.
US dollar index Technical Levels
The index has an immediate support at 88.13, under which losses could be extended to 87.81 levels. Meanwhile, resistance is seen at 88.75 (10-DMA) and 88.99 (5-DMA) levels.
The US dollar index trades 1% lower at 88.20 levels, compared to the previous session’s close of 89.05 levels. The EUR, with the highest weight of 57.6% in the dollar index, has gained 0.91% against the US dollar to trade at 1.2426 after the European Central Bank data showed a slowdown in the weekly asset purchases. Furthermore, the EUR also benefited from the declining US-Eurozone bond yield spreads.
Meanwhile, the Japanese Yen with a second highest weight of 13.6% in the dollar index, has gained 1.73% to trade at 118.62 levels per US dollar. The yen gained as the risk aversion in the financial markets led to the unwinding of risk-on trades initiated post the Bank of Japan’s surprise expansion of stimulus on Oct 31st.
Other components of the dollar index like the British Pound, Swiss Franc and Swedish Krona have posted modest gains against the greenback. The British Pound has been able to gain strength despite the disappointing Industrial production data released earlier today.
The US dollar index may continue to extend slide as the two major components - JPY and EUR – are likely to extend gains on safe haven appeal and declining treasury yields.
US dollar index Technical Levels
The index has an immediate support at 88.13, under which losses could be extended to 87.81 levels. Meanwhile, resistance is seen at 88.75 (10-DMA) and 88.99 (5-DMA) levels.