U.S. Dollar Euro Cross Rate chart returns to a buy signal following U.S. - E.U. Trade Agreement.

Monday’s market action was driven by the announcement over the weekend that the U.S and E.U. struck a framework trade agreement with baseline tariffs beginning at 15%. While the full and final details will be ironed out in the coming weeks and months, a variety of assets saw notable movement following the announcement. The U.S. dollar capped of Monday’s trading session up 1% and Tuesday’s intraday price action brought the Spot Index (DX/Y) above $99 on its default point and figure chart. This brings the chart of the Dollar Spot Index a little over 2.5% above its April lows with the initial chart reversal transpiring two weeks ago on 7/14. The chart continues to maintain a sell signal and a negative trend, and, at the moment, it would take a move above $101 from here on the default trend chart to return DX/Y back to a buy signal.

While investors look for additional upside action out of the dollar, trade is influenced by the price of the counterparty currency’s movement relative to the dollar. Following Monday’s action, the U.S. Dollar Euro Cross Rate (USDEUR) chart reversed into a column of Xs after having been in Os since last Wednesday (7/23). This places a higher bottom on the cross rate for the first time since giving a sell signal in January. Intraday action Tuesday brought the USDEUR cross rate above 0.8668, which will return it to a buy signal for the first time since January. From here, investors will await further details on the U.S.- E.U. trade deal, along with other potential resolutions to trade, to see if the dollar can build upon recent upside action.