The dollar bulls have been suffering from series level of uncertainty in the global market as Mr. Trump administration is totally unclear. The U.S dollar index secured a 14-year record high in the global market prior to the closing of the year 2016 and most of the investors were thinking that the dollar will dominate the year 2017.But things slowly changed as the sentiment of the U.S consumer turned out negative after the Mr. Trump failed to increase the fiscal spending in the U.S government. With the strong negative consumer sentiment, the U.S dollar index fell from its 14-year record high in the global market and pushed the all of its major rivals significantly higher. The professional Aussie traders made a decent profit by selling the green bucks in the global market. The recent performance of the U.S economy is still not up to the market but still, it’s holding the ground firmly as FED have projected three hikes in their interest rate.
Dollar pushed higher in the market: The dollar edged higher after the FOMC meeting minute as FED chairperson stated that they will release more high impact data in the market. Upon the release of such statement, the EURUSD dropped for 0.13percent and traded at 1.1195.The bullish strength of the U.S dollar was furthermore supported after the U.S initial Jobless data came out better than expected. Now, most of the leading economist researchers are thinking that the interest rate decision by the FED will play the major role in the next movement of the U.S dollar index. Though the FED have projected three rate hike the current performance of the U.S economy doesn’t support and imminent rate hike. But we will most likely see a 25 basis point rate hike in the month of June and if this happens we will see another decent surge in the U.S dollar index from the current level. However, some of the leading economists are in fear that an immature rate hike by the FED will create a long term bearish threat for the U.S economy. But regarding this concern, FED chairperson Janet Yellen has stated that they will hike their interest rate at the perfect time and the time is very near. Such an optimistic statement from Janet Yellen gave a solid ground to the dollar bulls in the market.
Currency market situation: Most of the major rivals of the green bucks faced a bearish threat in the forex trading industry after the FOMC meeting minute and the positive data of the U.S initial jobless claim. The GBPUSD pair dropped near about 0.54 percent and traded at 1.2871.The USDCAD pair recovered to a certain extent after the strong bearish rally and it traded at 1.3481.The decent bullish thrust in the USDCAD pair was furthermore intensified as oil price remained under bearish pressure despite the extension of the nine-month program in the global market. The upcoming week is most likely to be controlled by the dollar bulls as most of the fundamental factors are now favoring the green bucks’ bullish strength. Most importantly the FED is most likely to hike their interest rate in the month June and a hawkish rate hike will fuel up the green buck’s bulls in the global market.
Summary: Trading the financial instrument is now very much complicated as the investors have no clue regarding the next movement of the green bucks. However, the professional traders are still expecting a turnaround in the dollar as FED has projected three rate hike for the year 2017.But according to the leading researchers, the FED must be extremely careful since an immature rate hike will weaken the dollar for the long term. So it’s better to stay on the sideline and wait for the better trading opportunity to trade the market.