The dollar is ready to storm new heights
The dollar index early in the day on Monday, trading around the 97 mark, staying close to the local highs of the trading range for the last 6 months. Previously, the U.S. currency has moved away from these levels, however, this year the correctional kickbacks over and over again became less deep. This may be seen as a sign of the weakening of the selling pressure of the dollar. Breakthrough of resistance is able to move the crosshair buyers USDX to the important round level 100 and then 103, where the dollar rose in early 2017.
The British pound remains trapped between support at the 200-day moving average (around 1.2970) and the important round level at 1.30. In addition, it is worth noting that the GBPUSD likely failed beyond the boundaries of the uptrend. Break below will be confirmed in the case of reduction under 1.2970.
Earlier in the week, we are seeing cautious growth of the single currency in pair with the dollar to 1.1250 after the sale at the end of last week. Key European markets will be closed today, so trading volumes are expected to be reduced. Among the important macroeconomic publications is to pay attention to sales on the secondary housing market in the United States. Analysts expect a correction of 3.8% after a leap up to 11.8% a month earlier. The real estate market is an important indicator of economic activity. Weak home sales could help EURUSD to recapture some of their losses.
Oil prices jumped in early trading on Monday by 2.5% to $66 for WTI and Brent 73.60. The reason for breakthrough after a lull reports that the administration trump intends to toughen sanctions against Iran, refusing relief to 8 countries-importers. In addition to the collapse of production in Venezuela and OPEC+, the decision will shift the balance of production and consumption deficit. This is a strong positive news for the oil, but to keep the focus on comments by OPEC and the presidential administration. Now increase the chances that OPEC will increase the level of quotas. In turn, trump has repeatedly taken verbal pressure on the oil quotes.
______________ Alexander Kuptsikevich,