US Dollar bounces off lows post-US CPI

Pablo Piovano FXStreet

The US Dollar Index (DXY) has plummeted to the 92.90 area in response to poor results from US inflation figures, although it managed to regain some attraction and is now back above 93.00 the figure.

US Dollar offered on CPI

The index rapidly sunk to fresh daily lows in the 92.90 zone after US consumer prices rose less than expected during July. In fact, measured by the CPI, headline prices rose at an annualized 1.7% and advanced 1.7% YoY excluding food and energy costs.

The buck has now reverted the weekly positive performance and is heading towards a close in the negative territory, keeping at the same time the bearish note practically unchanged.

Later in the NA session, the buck is expected to remain in centre stage as Dallas Fed R.Kaplan (voter, hawkish) and Minneapolis Fed N.Kashkari (voter, dovish) are due to speak. The message, however, is now seen coming in on the dovish side following the recent CPI disappointment, opening the door for further pullback in DXY.

US Dollar relevant levels

The index is losing 0.25% at 93.07 facing the immediate support at 92.88 (low Aug.11) seconded by 92.43 (200-week sma) and finally 92.39 (2017 low Aug.2). On the flip side, a breakout of 93.77 (high Aug.8/9) would aim for 94.11 (high Jul.26) and finally 95.09 (23.6% Fibo of the 2017 drop).

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.

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