Dude, yesterday afternoon the dollar skyrocketed on expectations of US data! 📈 We're talking the fastest rise in four weeks—should we expect this to keep going, or will it correct soon? Let's discuss. How do you guys watch this trend? Are you attributing it to US inflation or rate decisions, or is there another factor at play here? 🤔
Dollar went through the roof! It's been on a tear for four weeks straight, but where do you think it's headed next?
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The dollar's rapid surge isn't exactly giving fresh heads a thrill, and I witnessed a similar sudden spike last week myself. When US data met expectations, liquidity demand exploded instantly, and of course, the stock market started fluctuating. I actually think this move is directly tied to US inflation or the Fed’s rate decisions because markets price data this way every time.
As for whether this will continue, I’m a bit more cautious. There have been similar sharp rallies in the past that corrected quickly—this could be the same story. Long-term, the dollar’s appeal seems to be fading, but short-term, who knows how high it’ll go? Rising US bond yields are also fueling this momentum, so I wouldn’t be surprised if it keeps going for a bit longer.
In the past four weeks, such a surge has been driven by US expectations, and if inflation data comes as a surprise, it will continue to rise. I had adjusted my investment amount to reflect the Fed's more hawkish stance while following the news the other day, and I'm seeing gains in that position.