US Dollar Index looks offered just above 95.00
|- The index starts the week on the back foot above 95.00.
- US stocks, bond markets will be closed on Monday.
- DXY gyrates around the 200-week SMA around 95.10.
The US Dollar Index (DXY), which tracks the greenback vs. a bundle of its main competitors, begins the trading week slightly on the defensive in the low 95.00s.
US Dollar Index appears supported near 94.60
The index has given away part of Friday’s moderate rebound although it is managing well to keep business above the key 95.00 barrier, so far ahead of the opening bell in the old continent.
The greenback, in the meantime, appears to be under pressure as market participants continue to digest Friday’s disappointing results from the US docket, where Retail Sales, Industrial Production and advanced Consumer Sentiment figures all came in short of expectations.
In light of the inactivity in the US markets due to the Martin Luther King Jr holiday on Monday, the next data releases will be regional manufacturing gauges tracked by the NY Empire State Index, the NAHB Index and TIC Flows.
What to look for around USD
The index managed to regain some composure and reversed the sharp weekly pullback on Friday, which has so far met decent contention near 94.60. Higher US yields propped up by firmer speculation of a sooner-than-anticipated Fed lift-off and supportive Fedspeak helped the buck to regain part of the shine lost in past sessions, all against the backdrop of persistent elevated inflation and the solid performance of the US economy.
Key events in the US this week: NAHB Index, TIC Flows (Tuesday) – Building Permits, Housing Starts (Wednesday) – Initial Claims, Philly Fed Index, Existing Home Sales (Thursday).
Eminent issues on the back boiler: Start of the Fed’s tightening cycle. US-China trade conflict under the Biden administration. Debt ceiling issues. Potential geopolitical effervescence vs. Russia and China.
US Dollar Index relevant levels
Now, the index is losing 0.06% at 95.11 but a break above 95.73 (55-day SMA) would open the door to 96.46 (2022 high Jan.4) and finally 96.93 (2021 high Nov.24). On the flip side, the next down barrier emerges at 94.62 (2022 low Jan.14) seconded by 93.27 (monthly low Oct.28 2021) and then 93.14 (200-day SMA).
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