Tariff ruling pushes the US dollar index to break the 50-day moving average, bullish momentum builds up

XM Forex APP News - On Tuesday (September 2), the US dollar index (DXY) rose sharply and broke through key technical positions due to the surge in U.S. Treasury yields and the global financial market's reaction to "the US court ruled that most tariffs were unconstitutional during Trump's period." The index broke through the 50-day moving average at 98.000 (currently becoming a short-term support level), with a high of 98.5895 intraday. The initial upward trend of the US dollar index appears to be driven by the large-scale short cover caused by the index's 50-day moving average. At present, 98.000 has been established as support, with the secondary support at the 61.8% Fibonacci retracement level (97.859) and the previous double bottom lows (97.536 and 97.556). In terms of resistance levels, the 50% Fibonacci retracement level 98.317 has become resistance again, followed by Tuesday's intraday high of 98.595 and the volatility high of 98.834 on August 22. This trend highlights the re-accumulation of bullish momentum in the US dollar, but intraday volatility is still at a high level. (Daily chart of the US dollar index: Yihuitong) Tariff uncertainty caused a surge in Treasury bond yields. While the US dollar rose sharply, U.S. Treasury bond yields also rose significantly. The yield on the 30-year treasury bond exceeded 4.97%, the highest level since the end of July; the yield on the 10-year treasury bond hit 4.279%; the yield on the 2-year treasury bond rose to 3.656%. Earlier, the U.S. Federal Court of Appeals ruled that the Trump administrationThe majority of tariffs imposed worldwide are unconstitutional, citing tax rights as the U.S. Congress. The ruling has sparked fiscal uncertainty and increased the possibility of tariff refunds and the expansion of U.S. Treasury bond issuance. The market regards "tax revenue may be reduced by US$172 billion in 2025" as a blow to deficit cuts, further putting pressure on the long end of the yield curve. Although the ruling is expected to be submitted to the Supreme Court, traders have begun to include factors of rising sovereignty risks in their pricing. European bonds and global risk sentiment Bond yields in European countries also rose sharply: due to political instability and budget concerns, France's 30-year treasury yield hit a 16-year high; in the UK, similar concerns pushed the 30-year treasury yield to its highest level since 1998. In addition, the pound fell by more than 1% as the outside world questioned the credibility of the new economic team led by British Prime Minister Keir Starmer. The wider bond sell-off puts pressure on global stock markets, with the Dow Jones Industrial Average falling more than 500 points intraday. At the same time, gold and the US dollar rose simultaneously, a phenomenon highlighting market imbalances - traders seek both hard assets to hedge and choose to hold cash to hedge. Market outlook: It tends to be bullish, but it needs to be cautious. The US dollar index breaks through the 50-day moving average, marking a change in short-term market sentiment. Traders will closely monitor the non-farm employment data released on Friday to obtain the above content about "[XM Group]: Tariff rulings drive the US dollar index to break the 50-day moving average, bullish momentum accumulates", which was carefully zgykf.cnpiled and edited by the editor of XM Forex. I hope it will be helpful to your trading! Thanks for the support!

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