Investors had more reason to buy stocks yesterday than the Federal Reserve introduced a $ 2.3 trillion stimulus value that included unconventional measures such as loans to states and municipalities.
The flow of funds to the stock markets, as well as the injection of liquidity by the Fed, caused the dollar to fall. The greenback is on the verge of being the worst performing among the main currencies of the week so far.
The weakness of the US labor market put additional pressure on the dollar as yesterday’s jobless claims report revealed last week 6.6 new jobless claims.
This is the third consecutive reading in which requests have been several times above average in recent years. Before the virus epidemic, the report would generally reflect about 200,000 people claiming benefits every week, going back several years.
The coming session should see a drop in volatility as the US stock markets will be closed in accordance with Good Friday. Inflation data will be released in the United States, although the impact can be mitigated. While inflation plays a vital role in monetary policy decisions, the Fed is currently focusing on the virus epidemic and today’s report should not change their outlook.
EUR / USD remains on the upside and the next area of potential interest falls to the psychological level of 1.1000. “data-reactid =” 29 “> The short-term trend in EUR / USD remains on the rise and the next area of potential interest drops to psychological level 1.1000.
Volatility is expected to decrease due to the holidays and any extreme movement in the coming session should be mitigated.
On the downside, support for the upcoming session is at 1.0900, which marks a confluence of support. The confluence is created by a horizontal level as well as by a trend line support.
The US dollar index fell below 100.00 on a sustained basis, which could lead to further losses for the index. The inverse correlation with the dollar and the stock markets remains strong, although the decline in the coming session may be limited, as the US stock markets are closed today.
- EUR / USD rallied this week as a return to risk appetite caused the dollar to fall against all of its major counterparts.
- The Fed implemented an aggressive $ 2.3 trillion stimulus package which further stimulated investor sentiment.
- The US stock markets will be closed today due to Good Friday.
article was originally published on FX Empire “data-reactid =” 38 “> This article was originally published on FX Empire