A note on the US dollar from Wells Fargo (comes via Bloomberg) with analysts at the firm bullish for DXY.
(ps. the note is from Tuesday US time but since its not a day trade view posting now as a bit of a catch up)
Watch the absolute change in US real and nominal yields, these are "crucial" for direction of the dollar, with risk sentiment being the "key swing factor"
- If US equities remain resilient to higher yields DXY could rise 1-2% back to the February highs
- if, however, stocks do slide with higher real and nominal US &DM yieldds Wells Fargo say we could see an even bigger upside move for DXY, in the region of 3 to 5% over the coming weeks.
