US Dollar Index eases from tops near 95.60
|- The index looks to extend the upside near 95.50.
- US 10-year yields approaching the 2.95% area.
- US-China trade effervescence remains as key driver for global sentiment.
The greenback, in terms of the US Dollar Index (DXY), has faded the initial optimism and trades off earlier peaks in the vicinity of the 95.60 area.
US Dollar Index looks to trade, Fed
The index is struggling for direction at the beginning of the week, showing so far no follow through after Friday’s bullish ‘outside day’, while market participants continue to digest the solid prints from the US labour market report from the month of August.
It is worth recalling that the US economy added more jobs than forecasted during last month (201K vs. 190K), although the most salient point was the auspicious uptick in Average Hourly Earnings, a proxy for wage inflation.
Friday’s Payrolls fuelled the likelihood of two more rate hikes by the Federal Reserve in the next months (September and December?), lending extra support to the buck. In the same line, renewed jitters on the US-China trade front came to the fore in past hours following Trump’s comments over the probability of more tariffs.
Nothing expected in the US data space, with only Atlanta Fed R.Bostic (voter, centrist) due to speak later in the day.
US Dollar Index relevant levels
As of writing the index is losing 0.07% at 95.34 facing the next support at 94.45 (low Aug.28) seconded by 94.20 (38.2% Fibo of the 2017-2018 drop) and then 94.08 (low Jul.26). On the upside, a break above 95.74 (high Sep.4) would open the door to 96.04 (50% Fibo of the 2017-2018 drop) and finally 96.96 (2018 high Aug.15).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.