The Dollar Index (DXY) had quite a tumultuous day on Tuesday. Weaker-than-expected Preliminary GDP figures for the fourth quarter of 2016, which came in 0.2% lower at 1.9%, sent the DXY down to 100.78 by 10:00 a.m. EST.
However, a more upbeat CB Consumer Confidence reading for February - 114.8 vs. January’s 111.6 - sent the DXY rallying 0.61% to a 3-day high of 101.40 by the end of the trading session.
The DXY closed on Tuesday with a gain of 0.19%. The bullish momentum unleashed by the consumer confidence news was sufficient to boost the DXY above the resistance level at 101.20, which market participants have traded around since Wednesday of last week.
Today’s strong performance by the U.S dollar also had a sizable effect on major Forex pairs, particularly the USD/JPY, which rallied 1.08% off the day’s lows at 111.687 to a daily high of 112.905. The USD/JPY closed on Tuesday with a gain of 0.09%.
Other major currencies like the euro, British pound, Canadian dollar and the Australian dollar, also posted losses vs. the greenback of 0.09, 0.5%, 0.91% and 0.21%, respectively.
Dollar bills photo by 401kcalculator
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