The US Dollar Index has seen a substantial rise. In the Tokyo market, it started with a steady upward movement near the previous day’s closing level (102.386). During the London session, it climbed towards 102.70 and reached the 10-day moving average (102.692). As the London session progressed, it gained momentum and reached a high of 103.166. It has clearly surpassed the 10-day moving average, indicating the most significant adjustment to the recent trend of dollar weakness since June. The next resistance level is at the 21-day moving average (103.358).
Concerns about the economic downturn in Europe spread across the market following the release of the preliminary PMI figures for Germany and France during the early London session, which showed a larger-than-expected decline. Amid the decline in German bond yields and other factors, the euro-dollar pair experienced a sharp drop. It fell more than 100 points from its high of 1.0959, reached during the Tokyo morning session, to 1.0844. As the euro holds the highest weight in the US Dollar Index, the decline in the euro-dollar pair has contributed to the rise in the US Dollar Index.
Today, during the European session, there was a flow of selling in European currencies and buying of the US dollar due to the unexpectedly large decline in the preliminary PMI figures for Germany and France.
This week has been characterized by significant fluctuations in daily market sentiment, making it challenging to grasp a clear trend. All the buy positions on the Nikkei 225 (CFD) taken since yesterday have been stopped out.
The plan for tonight is to continue focusing on riding short-term trends.
