US Dollar Index and another YTD high above 99.70

DXY records a fresh yearly peak in the 99.70/75 band.
FOMC minutes left no room for surprises on Wednesday.
Claims, Philly Fed index next of relevance in the calendar.

Pablo Piovano FXStreet

Another day, another yearly top in the greenback. Indeed, the US Dollar Index (DXY), which tracks the buck vs. a bundle of its main rivals, keeps the upside unabated in levels above 99.70 ahead of the opening bell in Europe.

US Dollar Index bolstered by data, risk trends

The index is extending its impressive monthly rally on Thursday, advancing to levels last traded in May 2017 in the 99.70 region and gaining around 2.50% in February only (and nearly 3.5% since the start of 2020).

Positive results from the US housing sector and higher-than-expected Producer Prices on Wednesday added sustain to the march north in the buck, while fears of recession in Japan badly hurt the Japanese yen, lifting USD/JPY more than 1% to levels above 111.00 the figure, area last visited din May 2019.

In addition, and also supporting the dollar, fears around the Chinese COVID-19 continued to ebb, adding to the idea that the worst scenario regarding the virus could be behind us.

In the calendar, usual weekly Claims are due along with the release of the Philly Fed manufacturing gauge and the EIA’s report on US crude oil supplies.

What to look for around USD

The index has extended the march north to new 2020 highs around 99.70 earlier in the session, keeping the bid bias well in place for the time being. Investors are expected to keep looking to the performance of US fundamentals and the broader risk appetite trends for direction as well as any fresh developments from the COVID-19. In the meantime, the outlook on the dollar remains constructive and bolstered by the current “appropriate” monetary stance from the Fed (once again confirmed at the FOMC minutes on Wednesday) vs. the broad-based dovish view from its G10 peers, the “good shape” of the domestic economy, the buck’s safe haven appeal and its status of “global reserve currency”.

US Dollar Index relevant levels

At the moment, the index is gaining 0.10% at 99.69 and a breakout of 99.72 (2020 high Feb.20) would aim for 99.89 (monthly high May 11 2017) and finally 100.00 (psychological barrier). On the flip side, immediate contention emerges at 98.94 (23.6% Fibo retracement of the 2020 rally) seconded by 98.54 (monthly high Nov.29 2019) and then 98.46 (38.2% Fibo retracement of the 2020 rally).

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.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.