24.07.2020: USD losing its shine (USDХ, DJIA, BTC, USD/CAD)

Wall Street is trading with moderate negative sentiment. Risk-on mood is dampened by geopolitical risks. Investors are worried about gloomy prospects of the US economy. The latest update on the US labor market confirmed the doldrums in the domestic economy. Today the US dollar sank to the lowest level in two years against the euro and other major currencies. The weaker dollar is beneficial to America. Nevertheless, the US authorities may be willing to halt its nosedive.
The US stock market opened in the red. Futures on the Dow Jones shed 0.28% to trade at 26,470. The S&P 500 slipped 0.32% to trade at 3,217.12.
The equity market is likely to remain under pressure until the jitters in the US – China relations are somehow relieved. Today Beijing ordered Washington to close its consulate in Chengdu, Sichuan province, in retaliation for the US move. Yesterday Donald Trump sent a clear message at the press conference that the trade deal signed earlier in the year is of little importance nowadays. Besides, the US President again pinpointed China as the source of the coronavirus outbreak.
Investors will regain appetite for risk in case the US lawmakers make more progress towards passing the new stimulus package.
The US dollar index is still losing ground against a basket of its rival currencies. It hit the lowest level since September 2018. The index settled down at near 94.57 in the early New York trade having shed 0.24%. There is strong likelihood that the greenback is set for a protracted downtrend.
Yesterday, it bounced in response to comments from Stephen Mnuchin. The Treasury Secretary pointed out weakness of the US currency and said that the authorities were ready to ensure its resilience. The market grasped his words as a hint that the financial authorities could protect the US dollar from a steeper decline. Perhaps the underlying aim is to revive investors’ interest in buying Treasuries which are viewed as secure investment unlike risky investment in stocks and other currencies.

The USD/CAD pair again tested the lower border of the downward channel. The pair is trading firmly lower. So, after an upward correction to 1.3470, the price will move down again. The nearest downward target is seen at 1.1330. At the same time, traders should not rule out the scenario of the US dollar’s revival against its Canadian peer. So, the currency pair might also rebound to resistance at 1.3550.

This week, bitcoin is still trading in the same sideway fashion. Nevertheless, analysts spotted some signs of a trend formation after its escape from a trading range.
The cryptocurrency edged up 4% this week which indicates slight interest of buyers. Probably, this comes as a result of the broad-based weakness of the US dollar. Investors are now seeking options of protecting their savings from depreciation.
On Friday, we are watching a notable upward correction from 9 640 dollars. Bitcoin could enter into another trading range of 9 500 to 9 610. Once it is over, the cryptocurrency is expected to gain bullish momentum. According to the perfect scenario, bitcoin should climb over 9 800 right away without any correction.
To sum up, bitcoin seems to be waking up. Long deals look like a good trading idea.

https://www.instaforex.com

FX Analytics - https://www.instaforex.com/forex_analytics
Forex Calendar - https://www.instaforex.com/forex_calendar
Forex TV from InstaForex - https://www.instaforex.com/instaforex_tv

Forex charts - https://www.instaforex.com/charts
Instant account opening - https://www.instaforex.com/fast_open_live_account
Forex Trading Contests - https://www.instaforex.com/forex_contests

List of official InstaForex blogs:
https://www.facebook.com/instaforex
https://www.instagram.com/instaforex/
https://twitter.com/InstaForex

#forex_news #american_session #instaforex_tv