The US dollar has been relatively strong compared to its foreign currency peers. Since the start of the year, the index is up by almost 8%. It closed at $103.21 on the 29th of April, the last trading day of the month.
The Uptrend has been intact as it continued to go up. On the 26th of April, momentum was extraordinary as it broke its upper channel to establish a new high. It had been a parabolic week (22nd to 28th of April) as it continued to close at new highs after new highs.
Note: The DXY Index is a measure of the US dollar strength against a basket of its major trading partners.
Best of the worst
Over the past month, the currencies that have weakened the most against the US dollar include the New Zealand dollar (down 7.4%), the Australian dollar (down 6.3%), and the Great British pound (down 4.1%).
We will zoom out to provide a holistic view of where the USD is at, leading to the upcoming FED’s interest rate decision. Currently, USD is trading within its long-term critical resistance level ($103-$104). The last time the US dollar was this strong was in March of 2020, when the Pandemic had just started, and the potential repercussion had not been priced in.
Nevertheless, The US dollar exemplifies its resilient and robust strength/value despite the economic hurdles the US is currently experiencing.
Fed Interest Rate Decision
The major economic event of the week is the Interest Rate Decision from the US Federal Reserve, due on Wednesday. The amount the US Fed is expected to hike rates is between 25 and 50 basis points. However, some Fed officials, such as St. Louis Fed President James Bullard, has eve floated the idea that a 75 basis points hike is warranted.