Greenback at Risk of Sharp Year-End Drop to Cap a Miserable 2020
Bloomberg 12/22/2020 Michael G. Wilson
(Bloomberg) The dollar is heading into the year-end vulnerable to a sharp extension of the bear run that’s shaped global currency markets since March.
Long-term trends on technical charts stretching back over the past decade reveal multiple trigger points that could see the greenback shoot lower against a host of key currencies.
Poor liquidity, lightly-staffed trading desks, defensive price-making engines and reduced seasonal demand add to the potential for outsized moves.
Read More: Dollar Reversal Pattern in the Making Signals Another 15% Drop
The Bloomberg Dollar Spot Index has bulldozed down through a multi-year uptrend and a closely-watched Fibonacci level. The 50% retracement of its trough-to-peak move since 2011, which halted the greenback’s most recent rout in early 2018, is being challenged again.