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  • Wednesday 12 August 2020

    Dollar Strengthens as Trump signs executive orders

    The dollar had been losing a lot of strength since the last two months as Europe has proven stronger against its competitor making the dollar lose more strength as investors were very much focused on investing their money on the Euro and on Gold.

    With the flow of investors leaving the dollar as a safe heaven, the Trump Administration has signed executive orders to save the US economy from the impact of the covid-19 pandemic by offering financial benefits for american citizens and lowering taxes on small income citizens including businesses. the executive orders are as follows:

    • Delay Payroll Tax Collection for those making less than $105 000
    • Unemployment aid is extended to $400 a week
    • Halt Evictions for Tenants 
    • All student loan payments has to halted till 31 December 2020 

    The executive orders has positively affected the dollar index and other currencies traded with the dollar index, the markets has formed great technical setups after the orders were released by the White House.

    Technical Analysis

    Dollar Index
    The Dollar index has been dropping recently as shown on the setup below and the currency has shown hopes for a bullish move as the dollar index has formed a double bottom pattern formation which sets the market for a bullish markets.

    The Kiwi Dollar pair has shown a very good Head and shoulder pattern setup, the pair is currently forming the right shoulder before it further drops more down.

    The Euro Dollar is below a critical resistance zone at level 1.18200, below this level we are currently looking for potential sell opportunities, the current sell target for the EurUsd we are looking at price reaching 1.14470 as a primary target.

    Sifiso Nkwanyana

    Author & Editor

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