Dollar index up to highest levels in more than a year
The greenback is breaking away from the resistance levels highlighted in the chart, and the rally since mid-April looks to be extending to another leg. At this point, after the built up pressure around the top we may see the dollar just take off from here.
Bids across the board is helping with that as EUR/USD also falls to its lowest levels since July last year. Only the Japanese yen remains the better performing currency against the greenback on the day:
The break of the 1.1500 level in EUR/USD opens up a potentially slippery slope in the pair and it's hard to argue against further momentum in the dollar when money is exiting EM swiftly. The situation in Turkey and Russia continues to favour flows into the greenback and that is adding to support for further dollar strength as long as the situation remains.
And from a technical perspective, the break above is also another tailwind for dollar bulls. Apart from that, the Fed appears to be undeterred in its path to raise rates despite a flattening yield curve and all that points to continued upside in the dollar for the time being.
