US Dollar Price Action
- It was a brutal day for the Greenback as the currency set yet another fresh two-year-low.
- Longer-term context is similarly bearish, as the recently completed November monthly bar confirmed the build of an evening star formation, which will often be followed with the aim of bearish continuation.
- The analysis contained in article relies on price action[1] and chart formations[2]. To learn more about price action or chart patterns, check out our DailyFX Education[3] section.
It’s been a pretty active morning so far in the US and the stage is setting up for an interesting NFP release[4] later this week. Jerome Powell offered commentary at 10am ET this morning, and this pushed a weak US Dollar[5] over the ledge to set a fresh two-year-low. A little later in the morning, President-Elect Joe Biden introduced his economic team during a press conference, which includes former FOMC[6] chair Janet Yellen as incoming Treasury Secretary, assuming she passes Senate confirmation. But the Yellen pick was not new ‘news,’ as this was circulating last week to the widespread jubilation across markets. Perhaps not coincidentally, two of the major hallmarks of her tenure atop the bank came into the spotlight, as equities gained while the USD[7] weakened.
But USD weakness isn’t a sudden phenomenon as the Greenback has been offered for much of the time since the March spike. There was a brief reprieve in September, after a big area of support came into play on DXY. That led to a bounce that lasted for a little over three weeks, but sellers were back and dominating the flow through the month of October.
