Forex Today: Rising Yields Boost U.S. Dollar

Adam Lemon

U.S. dollar strengthening as Treasury yields rise.

  • The U.S. dollar saw gains almost everywhere yesterday, as expectations that Democratic control of the U.S. Congress will boost spending and stimulus to a higher level gained traction and pushed up 10-year U.S. Treasury yields to about 1.15%. This is causing deep retracements in the long-term bullish trends of most other currencies against the U.S. dollar.

  • Bitcoin was held yesterday by support just above $30,000 but has risen from there quite firmly. As long as it remains below $36,374 it is unlikely to better the recent all-time high at $42,000 any time soon.
  • The U.S. House of Representatives has begun proceedings intended to impeach the president and to pass a resolution demanding the emergency replacement of the president with the vice-president. As the president will be leaving office in eight days, and the moves have either very little chance of success or cannot be completed within this period, it is clear this is political theatre that will have no real impact on the market.
  • Global coronavirus deaths have increased dramatically since early October to reach a level approximately 66% higher than the peak last April.
  • Total confirmed new coronavirus cases worldwide stand at over 91.3 million with an average case fatality rate of 2.14%.
  • The coronavirus vaccine drive has been criticized in the U.S. and E.U. for its relatively slow pace so far, although there are steps being taken in the U.S.A. to speed up the process. The fastest progression in terms of immunizing a population has been in Israel, which has already administered a first shot of the Pfizer vaccine to 21% of its entire population (including 75% of the over-60s) and began administering second doses over the weekend. The U.A.E. ranks second, having now vaccinated more than 11% of its population. For most of the world, a vaccine seems distant: only 8 countries have vaccinated more than 1% of their population.
  • The rate of new coronavirus infections appears to now be increasing most quickly in Albania, Andorra, Argentina, Austria, Bahrain, Belarus, Bolivia, Bosnia, Brazil, Chile, Colombia, Cuba, Czech Republic, Dominican Republic, Ecuador, El Salvador, Estonia, France, Germany, Greece, Guatemala, Hungary, Indonesia, Iran, Ireland, Israel, Italy, Japan, Kosovo, Kuwait, Latvia, Lebanon, Malaysia, Malta, Mexico, Mongolia, Montenegro, Niger, Nigeria, Pakistan, Panama, Paraguay, Philippines, Poland, Portugal, Romania, Senegal, Slovakia, South Africa, Tunisia, the U.S.A., the U.A.E., the U.K., Uruguay, and Venezuela.
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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