EUR Slices Through 1.1500 As EM Flows Into USD Sees Fresh Surge For Greenback?
As the lead USD rate, the EUR has now taken out the 1.1500 level in a move seen in late Asia - a time when liquidity is relatively thin. Stops were building up below this level, and in the last attempt to recover, sellers came in hard again from the low 1.1600's and the move lower has resulted in a drop to 1.1435 or so. As Europe and London now up and running, liquidity has improved and it is 1.1430-1.1530 range until we get the US inflation data later on this afternoon.
Looking across the board, the TRY has collapsed to over 6.000 vs the USD and along with other Emerging Market (EM) currencies with ZAR and RYB also much lower today. It will be interesting to see what the US administration says about these latest moves, with president Trump having been critical of excessive USD strength recently. As such, it pays to listen/watch out for tweets/headlines as the latest moves will have caused a noticeable stir.
For the DXY, we noted 95.80 and 96.20 as resistance points of note and the market has stalled ahead of the latter one - for now. Individual economic fundamentals are not driving this move for the large part, rather the demand for safe haven with yield and that all points to the USD at the moment.
Friday has started off on a lively note with the pressure on EMs brewing all week.