US Dollar Index bid around 99.60, focus on COVID-19
|- DXY resumes the upside and retargets 100.00.
- The White House estimates 100K-240K coronavirus deaths.
- US ADP report missed estimates at -27K jobs in March.
The US Dollar Index (DXY), which gauges the greenback vs. a bundle of its main rivals, is leaving behind Tuesday’s pullback and resumes the upside to the 99.80 region, where it met some resistance for the time being.
US Dollar Index bid as risk-on trade dissipates
The index has started the month/quarter on a firm note, managing to reverse Tuesday’s decline and now setting sails to the key resistance at 100.00 the figure amidst a mild bias towards the risk aversion.
In addition, the increasing selling bias in the euro is also lending extra wings to the recovery in the dollar, following mixed results from PMIs and discouraging news stemming from the coronavirus front.
In the US data space, the ADP reported a 27K drop in the job creation within the US private sector ahead of Friday’s Non-farm Payrolls during the same period.
What to look for around USD
DXY has regained the upper hand so far this week after bottoming out in the 98.30 region in past sessions. In addition, the greenback has so far managed to keep business above the key 200-day SMA and therefore maintaining the constructive outlook while re-targeting the triple-digit barrier. However, speculation of extra stimulus carries the potential to undermine the recovery in the buck and thus leaving the upside somewhat limited, all against the backdrop of unremitting concerns around the fallout of the coronavirus.
US Dollar Index relevant levels
At the moment, the index is gaining 0.63% at 99.58 and a breakout of 99.95 (weekly high Mar.31) would aim for 100.49 (78.6% Fibo retracement of the 2017-2018 drop) and then 102.99 (2020 high Mar.20). On the other hand, the next support emerges at 98.27 (weekly low Mar.27) seconded by 98.03 (200-day SMA) and then 97.87 (61.8% Fibo retracement of the 2017-2018 drop).
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