U.S. Dollar Rallies as PBOC Cuts
Gregor Horvat | Jun 20, 2023 02:21AM ET
Despite slow Monday sessions because of holiday in the US I updated some of the 4h/daily charts on the left. What I see is a dollar making some rallies vs other major currencies; ideally, a corrective move before more dollar weakness shows up. Normally the same flows will show up as before the holiday, which we know was the US Dollar Index Futures weakness.
Also, some of the USD strength comes from USDCNH as China cut two more key lending rates on for the first time in 10 months to support their economy. Its also a reason why Aussie and CNH comes down during the Asian session, but in long-term such a policy can have a positive impact on China stocks, the demand of commodities, and then also higher Aussie. Looking at DXY line chart, it appears like an ongoing weakness, but now pulling back a bit in wave four, so USD is expected to fall further after a current rally.
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