US Greenback (USD) bounced at first when Trump threatened with tariffs final Friday. However the bounce didn’t final, and USD prolonged its weak spot into Monday commerce. The worth motion underscores a re-pricing of weak USD sentiment and confidence. DXY was final at 98.03 ranges, OCBC’s FX analysts Frances Cheung and Christopher Wong notice.
Dangers are skewed to the draw back
“Final Friday, Trump threatened a 50% tariff on all items despatched to the US from the EU, as quickly as 1 Jun (however later prolonged to 9 Jul). He additionally warned Apple that he would impose a 25% import tax ‘at the very least’ on iPhones not manufactured in America and later broadened the risk to any smartphone maker together with Samsung. This transfer adopted Trump’s earlier announcement that the US would ship letters to a few of its buying and selling companions to unilaterally impose new tariff charges over the subsequent 2-3 weeks.”
“Nevertheless, it stays unclear whether or not these new tariffs could be along with present ones or if they’d supersede earlier charges. Compounding Trump’s tariff angst, the One, Huge, Lovely Invoice has additionally casted a protracted shadow over the sustainability of the US fiscal place. Coverage unpredictability surrounding Trump’s tariffs and the erosion of US exceptionalism may additional undermine sentiment and confidence within the USD.”
“Bullish momentum on day by day chart pale whereas RSI fell. Dangers are skewed to the draw back. Subsequent assist at 97.90 (2025 low), 97.40 ranges. Resistance at 99.10, 100.2 (21 DMA) and 100.80 (23.6% fibo retracement of 2025 peak to trough). US market is closed at this time for Memorial Day vacation.”
