Dollar Could Be Poised For Rebound After Steep Drop
After three straight weeks of a declining dollar, analysts think it may be time for a rebound.
The dollar strengthened against all other major currencies last year, but worries the Fed would hold off on rate hikes (which they have) have pushed the dollar's relative strength index to 24.7—its lowest level since 2012.
Technical analysts say anything below 30 means the currency may have gone too far and could be headed for a reversal, Bloomberg reports.
Last month analysts sang Bisnow a similar tune, saying they expected the dollar's drop to be a temporary phenomenon, as the dollar outperformed most major currencies for the last two years (see the skyrocketing chart above).
Even if the dollar does see a rebound, Credit Suisse analyst Christopher Hine says it’s unlikely the greenback will reach the more-than-decade high it hit in January.
“The dollar has been absolutely crushed across the board,” so you’d expect a rebound, he tells Bloomberg, but “it’s how much it can actually reclaim” that’s the question. [Bloomberg]
