USDOLLAR Weekly Chart Trends Up As Market Anticpates Tapering

The above chart show’s FXCM’s USDOLLAR index on a weekly time scale and is reflective of the primary trend. Longer-term charts tend to align with the underlying fundamentals and here we can see a higher trough followed by a higher peak – the technical definition of an uptrend. The greenback is trending up as market participants start anticipating the tapering of Fed expansion. In this regard. last Friday’s NFP was a good number and the USD responded. The Fed is likely waiting for another NFP print before any policy change as last month’s number did not fully factor in the current wave of Covid-19 sweeping through the US, and which doesn’t seem to have peaked yet. We note that price never moves in a straight line and if the uptrend continues we will be monitoring for evidence of a zig-zag structure similar to the dashed red lines.