Euro has already fallen to 1.175 from its 2018 high of 1.2556. How much further could it dip? Is Euro weakness (and hence, Dollar strength) here to stay in the long term? We answer these questions and give projections till 2019 . Supporting factors like the German-US yield spread are also analyzed.
In Dec ’17, we were expecting Dollar to strengthen in 2018. At that time, Dollar Index (reverse) and Euro looked like they were about to begin a 5th wave in their downmove from 2008 (see chart below).
DOLLAR INDEX STRENGTHENED TO 95After 1 month of weakening (from 92.67 to 88.54), followed by 3 months of ranging between 91.0-88.5, the Dollar Index finally started gaining strength from end-April and has seen a high near 95.03 so far. It currently trades near 93.86.
The year has been marked by rising trade war tensions due to an unpredictable US regime, which possibly prefers a weak Dollar. At the same time, positivity around US growth and inflation have pulled up US yields and strengthened the Dollar.
UPSIDE IN 2018 COULD EXTEND TILL 99-100The chart alongside depicts a long term trendline coming down from 2002, which could restrict the upmove in Dollar Index to 99-100. If this line is broken, the channel trendline drawn from 2009 could then provide resistance near 105.
For the above two resistances to come into play, the 24 months MA near 95.5 would have to be broken.
The video shows what we had predicted for the BSE Large Cap/Mid Cap Ratio in Nov ’17 and what actually happened. Also included is our prediction for the next move. For more such research, keep visiting https://kshitij.com/economic-calendar
The above video updates the Dec ’17 chart showing Consensus Forecasts for Global GDP Growth in 2017-20. It explores the reasons for a possible dip in 2018 growth and also the expected impact of such a dip. For more such research, keep visiting https://kshitij.com/economic-calendar. For our Crude Oil Forecast Service, visit https://kshitij.com/crude-oil-forecast
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Our January ’25 Quarterly Dollar-Rupee Forecast is now available. To order a PAID copy, please click here and take a trial of our service.
Our January ’25 Quarterly Dollar-Rupee Forecast is now available. To order a PAID copy, please click here and take a trial of our service.