Author: Mr.Amar – Technical Analyst

The US dollar fell more than 1% from its recent high as markets breathed a sigh of relief overnight when it was revealed that Ukraine may be considering a diplomatic solution. This solution would mean Ukraine’s commitment to neutrality but retaining all of its territories. The US fell sharply after posting sharp gains over the past few days. The drop coincided with a sharp reversal of what has been happening in the market lately. The next major catalyst for the DXY index will be US consumer inflation data that will be released tonight.

The European Central Bank (ECB) meets today and is expected to leave interest rates unchanged. G10 government bond yields rose, with the benchmark 10-year bond now yielding 1.94%, about 27 basis points above Monday’s low. Economists expect a large number. According to the median estimate, headline inflation rose to 7.9% in February from 7.5% in January. If true, it will be the highest US inflation number in more than four decades. Still, there are concerns that the US is headed for hyperinflation. For one thing, the Federal Reserve printed $120 billion worth of money a month. At the same time, the prices of most items have been on an upward trend in recent years. last weeks.

Technically, based on the chart, after hitting a high earlier in the week, the US Dollar Index (DXY) retreated to support levels but failed to break below them. The support level which once June’s 2020 peak, is now holding the buyer’s bias. Only the CPI data tonight might confirm the movement of the price, either break the support level or bounce back.