USD Index looks flat around 102.60 ahead of data
|- The index alternates gains with losses around 102.60.
- Decent support emerges around the 102.00 mark so far.
- Durable Goods Orders, Flash PMIs next on tap later in the day.
The greenback, when tracked by the USD Index (DXY), trades in a flattish fashion around 102.60 at the end of the week.
USD Index now looks at data
The index seems to have met some firm contention around the 102.00 neighbourhood – or multi-week lows – so far this week, as market participants continue to digest Wednesday’s dovish hike by the Federal Reserve and the dovish tilt at Powell’s press conference.
In the meantime, speculation of a pause in the Fed’s hiking cycle continues to run high and underpins the current bearish sentiment around the dollar, while easing banking jitters also prop up the risk complex and represent another source of weakness for the buck.
Later in the NA session, Durable Goods Orders for the month of February are due seconded by advanced Manufacturing/Services PMIs and the speech by St. Louis Fed J.Bullard (2025 voter, hawk).
What to look for around USD
The index remains well under pressure, although it manages to put further distance from recent lows in the sub-102.00 region on Friday.
So far, speculation of a potential Fed’s pivot in the short-term horizon should keep weighing on the dollar, although the still elevated inflation, the resilience of the US economy and the hawkish narrative from Fed speakers are all seen playing against that view for the time being.
Key events in the US this week: Durable Goods Orders, Advanced PMIs (Friday).
Eminent issues on the back boiler: Rising conviction of a soft landing of the US economy. Persistent narrative for a Fed’s tighter-for-longer stance. Terminal rates near 5.5%? Fed’s pivot. Geopolitical effervescence vs. Russia and China. US-China trade conflict.
USD Index relevant levels
Now, the index is retreating 0.03% at 102.55 and the breach of 101.93 (monthly low March 23) would open the door to 100.82 (2023 low February 2) and finally 100.00 (psychological level). On the other hand, the next resistance emerges at 103.88 (55-day SMA) followed by 104.37 (100-day SMA) and then 105.88 (2023 high March 8).
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.