Monday, August 21, 2017 9:55 AM EDT
After consolidating in the Asian session and European morning, the euro has been bid higher in North America. It is testing a downtrend line, drawn off the year's high set in early August near $1.1910, as depicted in this Great Graphic, composed on Bloomberg.
It is met the 50% retracement objective near $1.1785 today. The 50% retracement is pegged at $1.1815.
There does not appear to be a new fundamental driver of the move. We suspect that North American participants are more dollar-negative than many foreign investors presently. Near the end of the European morning, the dollar was higher against nearly all the major and emerging market currencies. Now it is down across the board, including most of the emerging market currencies.
Many economists seem to think that Cohn is the most likely to succeed Yellen at the helm of the Fed. This is not the unalloyed good that some may have thought at the end of last week. If Cohn does move over to the Fed, it may leave a disturbing vacuum in the White House. Treasury Secretary Mnuchin is not seen having the saving market gravitas.
The Dollar Index is just above it uptrend line, also drawn off the August 2 extreme. It is seen near 93.15 today, which is also the 61.8% retracement of its bounce from earlier this month.
Disclaimer: Read more by Marc on his site Marc to Market.
Opinions expressed are solely of the ...
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Disclaimer: Read more by Marc on his site Marc to Market.
Opinions expressed are solely of the author’s, based on current market conditions, and are subject to change without notice. These opinions are not intended to predict or guarantee the future performance of any currencies or markets.
This material is for informational purposes only and should not be construed as research or as investment, legal or tax advice, nor should it be considered information sufficient upon which to base an investment decision. Further, this communication should not be deemed as a recommendation to invest or not to invest in any country or to undertake any specific position or transaction in any currency.
There are risks associated with foreign currency investing, including but not limited to the use of leverage, which may accelerate the velocity of potential losses. Foreign currencies are subject to rapid price fluctuations due to adverse political, social and economic developments. These risks are greater for currencies in emerging markets than for those in more developed countries. Foreign currency transactions may not be suitable for all investors, depending on their financial sophistication and investment objectives. You should seek the services of an appropriate professional in connection with such matters.
The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete in its accuracy and cannot be guaranteed.
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