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Bank of America confirmed that the US Dollar Index (DXY) historically tends to rise from August until the US election day in November, indicating potential strength for the US dollar ahead of the upcoming elections.
Key points:
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Seasonal trends: Since 1970, the US Dollar Index has strengthened in August, weakened from September to mid-October, and then regained strength in late November before falling toward the end of the year. This trend has been consistent, with the US Dollar Index often peaking by August.
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The impact of the euro: Since the euro began trading in 1999, the US Dollar Index (DXY) has shown a tendency to rise from early August through late November, with a subsequent decline until the end of the year.
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Election year trends: In the past 13 years of U.S. elections, the U.S. Dollar Index has generally trended higher from 70 trading days before Election Day until Election Day itself. This pattern has been observed in 10 of the 13 years of elections, with the U.S. Dollar Index rising 77% of the time during this period.
conclusion:
Bank of America notes a historical pattern where the US dollar tends to strengthen from August until US election day. This season suggests that the US dollar could rise as markets approach the upcoming November election.
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