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Has Powell called an end to the dollar party? Check out the Dollar index now

The dollar is on the back foot this morning, there can be no denying that. Even the GBP/USD is making some limited progress ahead of what is expected to be a non-event from the Bank of England this morning. So, the USD index (SDX) has fallen back below 106.50 after rising above 107 yesterday. The high seen was set at 107.11 and at that moment the path seemed clear for more upside. The trouble is it did not happen and the index fell back into the US close. It is fair to say, that the current upside run for the dollar has been predicated on a combination of higher US yields sand geopolitical concerns in the Middle East. Well, those yields have now fallen back and so far the conflict in Gaza has not spread. Of course it may yet do so, but that is not something that can easily be determined yet. If it does then the dollar has further potential, but if not then the continued failure of the USD index to really break above the 107.34 (October 3) high risks a deeper relapse coming into the end of the year. The USD index is now pushing to session lows, as it remains under pressure and approaches 106.25 just now 
 

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