Dollar at risk of a bigger slump as Jackson Hole looms
Aug 21 (Reuters) -The dollar remains vulnerable as Jackson Hole looms large, where Federal Reserve Chair Jerome Powell will deliver a speech. FX traders should prepare for a bigger slump in the greenback into that risk event.
The USD index has this week collapsed under the 102.002 Fibo: a 76.4% retrace of the 100.61 to 106.51 (December to April) rise. The risk grows for a bigger drop to the December 100.61 base, especially as 14-day momentum remains negative.
A break under 100.61 would add significantly to the negative outlook and see the dollar come under even more pressure across the board.
USD's fate is pinned to largest components of the index: euro, yen and the pound. The dollar slipped to its lowest this year versus the euro on Wednesday, dipped below the closely watched 145 yen level and hovered close to the more-than-one-year low to sterling reached overnight.
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Martin Miller is a Reuters market analyst. The views expressed are his own; Editing by Alison Williams
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