USD Index Starts Inching Toward Highs Again, Société Générale Economists Say Rebound Towards 114.8 Peak ‘Is Not Ruled Out’ – Economics Bitcoin News

In 2022, the U.S. dollar has been very strong, despite the global economy’s downturn and the rising inflation worldwide. 12 days ago, the U.S. Dollar Index (DXY) rallied to a high of 114.8 and since then, the index has pulled pack and a recent analysis from economists at Société Générale notes that the index will likely rally back toward the 114.8 high.

Greenback Index Starts Climbing Again After the Recent Pullback, Société Générale Economists See a ‘Prevalence of Upward Momentum’

The U.S. currency, commonly known as greenback, has proven to be an imposing foe in the face of a multitude fiat currencies. A large swathe of fiat currencies like the euro, pound, yen, yuan, and Australian and Canadian dollars have all suffered from the greenback’s strength. On September 27, the U.S. Dollar Index (DXY) tapped a high of around 114.8, a height that hasn’t been recorded since 2001. DXY measures the value the greenback against six fiat currencies.

The basket of fiat currencies traded against the U.S. dollar consists of the European Union’s euro, the Swiss franc, the Swedish krona, the British pound, the Canadian dollar, and the Japanese yen. However, six currencies are not evenly distributed. The euro accounts for 57.6%, while the yen makes up 13.6%. The index gives traders, analysts, and economists a fair valuation of the dollar’s strength against the basket of foreign currencies.

USD Index Starts Inching Toward Highs Again, Société Générale Economists Say Rebound Towards 114.8 Peak ‘Is Not Ruled Out’

In 1973, the DXY was created by Richard Nixon (the U.S. president) who removed the gold standard from the Bretton Woods Agreement. The DXY started out with 100 points as a base. Since then the index has grown tremendously, hitting an all-time high of 158.41 in February 1985. The DXY was at 160.41 in 1985. To break the 12 day old record, it would need to rise by 39%.

Economists from the French-based financial services company Société Générale S.A. (Socgen), believe the DXY is heading back toward the 114.8 range after the recent dip. “A rebound towards 113.60 and the peak near 114.80 is not ruled out,” the Socgen economists detailed on October 7. According to the economists, a dip below 110 would indicate a stronger pullback. However DXY trades at approximately 112.747 Sunday morning at 11:00 EST.

“Only if the support zone at 110.00/109.30 gets violated would there be a risk of a deeper pullback. If this happens, [the]Next goal could be at [the] September low of 107.60,” the Socgen economists wrote in the company’s U.S. dollar and market outlook note. “Daily RSI is still within bullish territory denoting prevalence of upward momentum,” the economists added.

Current five-day metrics suggest that the euro is currently down 2.39 percent against the U.S. Dollar, the Japanese yen has dropped 1.02%, and British pounds is down 3.19%. One ounce gold is now down by 1.04%, while silver is currently down around 2.47%. However, the price of one troy-ounce of.999 pure silver remains above $20. In the past 24 hours, the global crypto market capitalization for all cryptocurrencies has increased by 0.08%. The crypto economy currently stands at $944.60 million.

Equity markets closed in the red on Friday afternoon as Nasdaq shed 3.8%, the Dow Jones composite lost 2.05%, NYSE declined by 3.34% and S&P 500 saw a 2.8% decrease in value. More than one trillion nominal U.S. dollars were erased from the U.S. stock market on Friday, or a USD value that’s larger than the size of the entire crypto-economy today.

This story contains tags
1985, 2001, Australian dollar, Canadian Dollar, crypto market, DOW, DXY, Euro, Euro drops, Franc, French Bank, gold, Highs, krona, Major Stocks, nasdaq, NYSE, pound, pound slips, S&P 500, silver, Socgen, Socgen economists, Societe Generale, Société Générale S.A., U.S. dollar, upward momentum, US Dollar Index, USD, USD trading, yen

How do you feel about the U.S. Dollar rebounding? Are we heading towards recent highs or are we just a little too optimistic? Comment below to let us know your views on the subject.

Jamie Redman

Jamie Redman, a Florida-based financial journalist and news lead at News is Jamie Redman. Redman is an active participant in the cryptocurrency community from 2011. Since 2011, Redman has been an active member of the cryptocurrency community. Redman is a prolific writer for News, with over 6,000 articles on disruptive protocols.

Image creditShutterstock. Pixabay. Wiki Commons

DisclaimerThis information is provided for educational purposes only. This article is not intended to be a solicitation or offer to sell or buy any product, service, or company. is not a provider of investment, tax, legal or accounting advice. The author and the company are not responsible for any loss or damage caused or alleged caused by the content or use of any goods, services, or information mentioned in the article.

Get more Crypto News at CFX Magazine