The U.S. Dollar continues to climb against its rivals as risk aversion appears to be on the rise. The USD has in fact climbed exceedingly higher against the EUR by reaching a price level below 1.4100 for the first time in over 20 weeks. The greenback also managed a recovery against the JPY's recent surge by reaching back towards 91.50.
American and European stocks were traded lower this week due to risk aversion among traders, and this has helped support the Dollar's resurgence. This week's data releases have also supported this notion. While figures such as the NAHB Housing Market Index and US Housing Starts have shown a decline in the housing market, other sectors of the economy have shown modest improvement.
Tuesday's release of TIC Long-Term Purchases highlighted a vast improvement in domestic and foreign investment in the United States. If this trend continues with the Phily Fed Manufacturing Index today, we could see the Dollar's rise propel itself forward even more.
With a EUR-heavy news day ahead of us, the USD may take a back-seat during the morning hours. A slew of positive releases from the Euro-Zone could allow us to see a rebound in a few of the major pairs. On the other hand, if Europe's data falls short of expectations, traders should anticipate a continuation of the bullish run in the USD.