Greenback falls on potential Syria strike, China eyed

Greenback falls on potential Syria strike, China eyed

Global Economy

The value of the US dollar is measured against a group of six major currencies in the U.S Dollar Index, and as of 03:25 AM ET (07:25 GMT) the US dollar dropped 0.17% to 89.17.

The United States & Western Allies are conspiring to launch a military strike on Syria. It’s probable that the turmoil in Syria coupled with the trade war between America & China may have led to the decline of the US dollar. The dollar is under substantial uncertainty as a result of the alleged chemical attack. Russia is working hard towards dissuading US from taking any military action in order to not accelerate the tension between the two countries.

There geopolitical events seems to have attributed towards the escalation of tension, and as a result the investors may have been pushed to move their investments to more secure and stable financial instruments from a fundamental point of view. It’s a norm, global events are volatile and hence may lead to unforeseen results are a result of the growing uncertainty.

It’s is observed that the effects not only apply to the US dollar but also related financial assets such as commodities and oil. It’s advised to monitor the technical & the fundamental facets of these instruments as to avoid any unanticipated result.

The fall and escalation of the pair can be attributed to thriving fear due to the uncertainty.

Over the course of today’s session so far Greenback seems to have gained some traction against other currencies, with the weighted mean currently at 89.72, having recouped some losses from the yesterday’s close of 89.40. Further development from China and Syria will be under watchful eye and could instigate some activity if the situation spins out of control.

EUR/USD

Single currency has retraced some of the gains posted yesterday. The mood of the markets has somewhat been worsened as European Council extended sanctions against Iran while Syria is adding to the overall negativity. As of now, the pair is traded at 1.2349 apparently to proceed unhindered to the downside as previous trend channel visible seems to have been broken without meeting any obstacles. The pair is currently testing support at 1.2337. Next supports are at 1.2288 and 1.2262.  A sustained breakout of 1.2337 could present a good opportunity to make some pips in the short-term.