US Dollar bounces off 88.40
- DXY dropped to fresh lows on Draghi, tested 88.40.
- ECB kept rates on hold, as largely anticipated.
- Draghi disappointed EUR-bears.
The US Dollar Index (DXY) – which tracks the greenback vs. its main competitors – managed to regain some ground after dropping to fresh multi-year lows in the 88.45/40 band during Draghi’s press conference.
US Dollar hurt by (hawkish?) Draghi
The index fell further to record fresh 3-year lows in response to Draghi’s tone at his press conference today, all following a steady stance by the ECB at its meeting earlier in the session.
However, the buck found some buying interest after Draghi almost ruled out a rate hike this year, managing to regain the 88.80 region, albeit within a still clear bearish bias.
On the US data front, initial claims came in at 233K WoW, taking the 4-week average to 240.0K from 243.5K. Further releases saw new home sales dropping to 625K units, or 9.3% during December.
In the meantime, investors’ attention should shift to President Trump and his speech at the WEF in Davos.
US Dollar relevant levels
As of writing the index is losing 0.62% at 88.52 and a break below 88.42 (2018 low Jan.25) would expose 87.64 (low Dec.16 2014) and finally 84.48 (low Oct.15 2014). On the upside, the next barrier aligns at 90.70 (high Jan.22) seconded by 90.98 (high Jan.18) and then 92.64 (high Jan.9).
Author
Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.
