GOLDWELL：Daily Market Recap – DXY Dollar falls to a two-week low

The

dollar is under short-term pressure following weak U.S. economic data, a

reassuring speech by Jerome Powell on the Fed's upcoming tapering, and a

clear resumption of investors' risk appetite.

Recent

U.S. data disappointed, raising fears of a sharper than expected

slowdown in the world's largest economy. Markit's flash PMIs released

last week remained strong, but below expectations. Both manufacturing

and service sector activity slowed more sharply than the consensus

forecast. The August composite PMI finally came in at 55.4, while the

consensus forecast was for a much higher number at 58.3.

Finally,

the dollar is also experiencing a resurgence in risk appetite among

short-term investors. Cyclical currencies such as the euro and the

Australian dollar have outperformed safe-haven currencies such as the

dollar and the yen for several sessions.

Since

the Fed's monetary policy stance will depend largely on the recovery of

the labor market, Friday's NFP report will be the most important

macroeconomic release of the week, if not the month of September.

I

the medium to long term, the DXY outlook remains bullish above the low

at 91.70 points. A pullback below this level would invalidate the

bullish reversal signal for the DXY given in mid-August following the

top exit from the symmetrical triangle.

Disclaimer:

This material has been created for information purposes only. All view

expressed in this document are my own and do not necessarily represent

the opinions of any entity.