KEY POINTS OF THE ARTICLE ON THE DXY PRICE:

• The dollar under pressure in the face of deteriorating public accounts
• The improved global economic outlook is also hampering the greenback
• The DXY depresses the symbolic support of the 90 points

THE DOLLAR UNDER PRESSURE AS PUBLIC ACCOUNTS DETERIORATE

The greenback continues to plummet in this first session of the year. The dollar is underperforming all major currencies to the point of recording a nearly 3-year low of 89.44

The dollar is under pressure in the face of deteriorating public accounts. The new $900 billion stimulus package ratified by the American president last week will further drive up American debt, which is expected to peak at around 130% of GDP in 2020

Concerns about American debt are thus taking precedence over the benefits of the recovery plan. Investors are increasingly doubting the ability of the United States to repay its debts. The situation is also worrying in Europe, especially in the countries of the South, but debt is still much lower than that of the United States at the EU level (thanks to the lower debt of the countries of the North)

THE IMPROVING GLOBAL ECONOMIC OUTLOOK IS ALSO PENALIZING THE GREENBACK

The dollar has also been affected by the improved global economic outlook over the past several weeks. The 2021 economic outlook has been revised upwards thanks to the conclusive results of several covid vaccines. Nobody anticipated vaccines this early, which will allow the global economy to recover more rapidly and, above all, sustainably in 2021. The faster vaccines are produced and distributed, the better the global economic outlook will be and therefore the more pressure will be on safe havens such as the dollar

In the shorter term, the outlook for the dollar will depend primarily on numerous economic publications. This week, traders will read the PMI indices, the ISM indices, the ADP survey or the monthly American employment report (the famous

THE DXY DEPRESSES THE SYMBOLIC 90-POINT SUPPORT

In terms of technical analysis, we can see that the DXY hit the symbolic support of 90 points at the end of December. The deepening of this support is a signal in favor of a continuation of the downward trend since it shows that the dollar sellers are still

The next support to watch will be the 2018 low of 88.25 points. As in 2018, dollar buyers could regain control of this price level. If this is not the case and the DXY deepens this support, the bearish outlook will be maintained. The next support to watch would then be the peaks of 2012 and 2013 (exceeded in 2014) at around 85 points