Things seem to have quieted down for USD. Is this a Biden - not colorful - effect or something else going going these few days?
Anyone has reason for volatility to pick up soon?
Anyone has reason for volatility to pick up soon?
is USD's lack of volatility Biden?
- Thread starter salamanderforex
- Start date
just did a thread myself on it. https://www.elitetrader.com/et/threads/somethings-happening-here.354797/
Why wouldn't it go down under biden?
It might be illuminating to ask that question in another way. What are all the macro factors that would cause the EUR, CAD, RMB... all go up versus the dollar?
I'm guessing you think Europe is a socialist hellhole, China is going to walk all over the U.S., and even those Canadians are pretty shifty with their socialist healthcare and all, amiright? So when Biden becomes President is the Eurozone going to suddenly repent from their socialist ways and that will strengthen their currency? Is China, which has purposely kept their currency devalued versus the dollar for the past 25 years suddenly going to reverse course and allow it to appreciate (which would greatly benefit the U.S. while being to their detriment with respect to the trade imbalance). Are the Canadians suddenly going to do, what exactly? to make the CAD appreciate versus the USD?
If not that, then what factor would cause all these other currencies to appreciate, which hopefully you appreciate is required for the dollar to depreciate?
Usd has already sold off a fair bit and expanded spending is most likely fully priced in by now. Call it "trading within the fair value band". The next catalyst will move usd again.
Boy, you still have a lot to learn in macro trading. Supply and demand is what ultimately moves prices. The question here is what impacts supply and demand and by how much. Politics and policies greatly impact supply and demand for the Usd and most other currencies. Even the Canadian dollar correlation with commodity prices is almost broken for good. The Canadian dollar these days is driven mostly by property prices, immigration, and above all, monetary and fiscal policies.
Exactly. So what's the answer to my question to @Trader Curt? What would Biden do as President that would drive the rest of the world's currencies up?
Unlike @Trader Curt I do have at least a basic macro background. My best guess is that the pandemic has equally impacted most of the world, so comparatively currencies will remain on a random walk with one another. Certainly deficit spending tends to devalue a currency, so if you think Biden will continue Trump's debt binge than that might point to a stronger Euro except the entire eurozone is doing the same thing. And China certainly isn't going to strengthen their currency, if they do it will simply fix the trade deficit which Trump has increased over the past 4 years which isn't something China wants. And there isn't any fundamental fleeing to the Euro or any other currency that could be reasonably predicted based on what we know today that would cause a supply and demand imbalance. So basically the price of the dollar today reflects everything we know about the future price of the dollar.