BUZZ-COMMENT-Dollar supported by a number of factors for now
Oct 19 (Reuters) - Market uncertainty, the large speculative dollar short and major technical support will limit the downside in coming sessions.
The dollar on Monday has been stable, with investor worries about rising coronavirus cases, the looming U.S. election and fading prospects of any fiscal stimulus beforehand providing support . If Joe Biden wins and the Democrats take control of the Senate, that would probably result in larger stimulus, which would be negative for the dollar.
Data for the week ending Oct. 13 show the net short USD position held by speculators dipped to $27.2 billion from $28.4 billion the previous week. However, the sheer size of the remaining speculative short position shows the risk for a bigger squeeze higher.
USD index, which tracks the dollar versus a basket of six currencies, found support in August and September ahead of the 91.729 Fibonacci level, a 76.4% retrace of the 88.251 to 102.99 (2018 to 2020) rise.
Dollar positioning is derived from net contracts of IMM speculators in the euro, yen, British pound, Swiss franc and Canadian and Australian dollars.
For more click on FXBUZ
IMM USD Positions Chart: https://tmsnrt.rs/347wTmF
Monthly Chart: https://tmsnrt.rs/2HhCf61
(Martin Miller is a Reuters market analyst. The views expressed are his own)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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