US Dollar Index tumbles to fresh lows, threatens 96.00
- The index loses further momentum and approaches 96.10.
- US 10-year yields climb to daily highs closer to 2.74%.
- Housing data, Goods Orders postponed due to shutdown.
The US Dollar Index (DXY), which tracks the buck vs. its main competitors, faces further selling pressure and drops to session lows in the 96.20/10 band.
US Dollar Index upside capped near 96.70
The index remains unable to gather some serious traction today amidst the generalized better mood surrounding the riskier assets and despite yesterday’s bullish ‘outside day’ session.
DXY, in the meantime, managed to test weekly highs near 96.70 post-dovish ECB on Thursday, although the up move did not have any follow through.
In today’s calendar, publications of New Home Sales and Durable Goods Orders have been postponed due to the ongoing government shutdown.
What to look for around USD
The potential impact of the onging US shutdown on the economy appears to be gathering some traction among investors and carries the potential to dent the sentiment if it remains unsolved. In addition, the US-China trade spat is slowly returning to the markets’ radar ahead of next week’s meeting between US and Chinese officials.
US Dollar Index relevant levels
At the moment, the pair is losing 0.40% at 96.18 and faces immediate contention at 96.04 (low Jan.24) followed by 95.76 (50% Fibo of the September-December up move) and then 95.20 (200-day SMA). On the upside, a break above 96.68 (high Jan.24) would open the door to 96.79 (23.6% Fibo of the September-December up move) and finally 96.96 (2019 high Jan.2).