Key Points:
- USDX (US Dollar Index) hit 104.061, its lowest in four months.
- Trump delayed auto tariffs on Mexico and Canada by one month, following a 25% tariff on Canadian and Mexican imports imposed earlier.
- Trade uncertainty weakens trader confidence, pressuring the USD.
USD Declines as Trade Policy Creates Uncertainty
The USDX (US Dollar Index) fell to 104.061, a four-month low, after President Trump unexpectedly delayed auto tariffs on Mexico and Canada by a month. This decision follows the U.S. imposing a 25% tariff on Canadian and Mexican imports, sending mixed signals to the market.
Shifting trade policies are fueling market participant uncertainty, weighing on business sentiment and consumer spending. This trade instability largely disrupts investment–keeping the USD under pressure.
Technical Analysis
Picture: USDX declines to 104.084, struggling below resistance at 105.54 as bearish momentum persists–learn more on the VT Markets app.
USDX declined 1.38%, closing at 104.084 after opening at 105.541. The index reached a high of 104.341 and a low of 103.959, reflecting strong bearish momentum.
The moving averages (MA 5,10,30) indicate a sustained downtrend, with the price remaining below the longer-term average. The MACD (12,26,9) remains negative, but histogram bars are stabilising, suggesting selling pressure may be easing.
Key support is at 103.95, while resistance is at 105.54. A rebound above resistance could trigger further upside, whereas a break below support may lead to additional weakness.
Market Outlook
Traders will watch for further policy shifts and economic data for direction. If uncertainty persists, the dollar may remain under pressure, but signs of trade resolution could stabilize sentiment.
