While the coronavirus pandemic continued to worsen globally, investor sentiment somewhat stabilized after governments and central banks rushed to push out tighter lockdown measures, fiscal stimulus and monetary easing. Dollar suffered massive selling on easing risk aversion, improving funding conditions, as well as Fed’s QE infinity. Canadian Dollar ended as the second weakest after BoC’s rate cut and QE, then Yen. Sterling was surprisingly the strongest one, followed by Australian and then New Zealand Dollar.

Nevertheless, it should be noted that recovery in US stocks have already been losing momentum since Thursday. We might see a come back in risk aversion if there is no slowdown of the coronavirus spread. In particular, some Asian countries like Singapore, Malaysia, Thailand, and even Japan, are vulnerable to second wave of attack by the coronavirus. Dollar, which is now close to key support zone, could strike back. The coming week could be crucial to the greenback’s fortune for Q2.

Dollar index suffered a huge setback last week after Fed’s QE infinity announcement. Break of 55 day EMA (98.72) is a sign of disruption of the up trend. While further decline might be seen initial this week, we’d tend to look for strong support from 61.8% retracement of 94.65 to 102.99 at 97.83 to bring rebound. But even so, there is little prospect of up trend resumption for the near term as consolidation form 102.99 should extend for a while.


source_https://www.actionforex.com/