Dollar Fights Back
The Dollar posted gains today on some unexpected positive economic data. The Dollar Index (DXZ7) – which measures the greenback against a basket of world currencies – gained 1% on the day.
With the downtrend dominating the overall picture the last month few months, today we broke through a minor double top that was set a few weeks earlier. The interesting thing is that we are now above both the 15- and 25-day moving average, both of which acted as a minor support earlier this week.
Private sector hiring increased by 189,000 in November, shattering expectations of only a 60,000-job gain. With numbers like this coming out, any talk of a recession would seem to be on weak footing. Positive news about the U.S. economy helps the greenback, of course, but it will be interesting to see how this affects (or doesn’t affect) next week’s Fed meeting. If there is a pause in rate movement, it could mean good news for Dollar bulls.
Mike Tosaw, Director of Education
