- DXY sticks to the daily recovery although below the 94.00 mark.
- Markets’ sentiment keeps favouring the safe haven demand on Tuesday.
- S&P/Case-Shiller Index came in below estimates at 3.7% in May.
The greenback, in terms of the US Dollar Index (DXY), remains on the positive note around the 93.70 region on Tuesday.
US Dollar Index looks to data, FOMC, earnings
The index is so far reversing a 6-session negative streak, including fresh 2-year lows in the 93.50 region on Tuesday.
The greenback appears benefited on Tuesday following the profit taking mood in the risk complex, all in response to the strong gains recorded in past weeks.
The dollar’s recovery, however, is expected to be short-live and somewhat limited, as the broader risk appetite trends continue to favour inflows into the riskier assets, always against the backdrop of the reflation trade, optimism ahead of corporate earnings and hopes of a coronavirus vaccine.
In the US data space, house prices tracked by the S&P/Case-Shiller Index expanded 3.7% in May from a year earlier, missing previous estimates. Later in the NA session, the focus of attention will be on July’s Consumer Confidence gauge by the Conference Board.
What to look for around USD
The relentless advance of the coronavirus pandemic in the US and across the world vs. the probability that a COVID-19 vaccine could be out in the medium-term plus the ongoing reopening of global economies are all driving the sentiment in the global markets while keeping the demand for the safe haven dollar well depressed. While bouts of risk aversion are seen supportive of the greenback, these seem quite unlikely, at least in the near-term, in the current context and therefore any rebound in DXY should be deemed as short-lived. On another front, the speculative community kept adding to the offered note around the dollar for yet another week, opening the door to a potential development of a more serious bearish trend in the dollar.
US Dollar Index relevant levels
At the moment, the index is gaining 0.02% at 93.67 and a break above 94.20 (38.2% Fibo of the 2017-2018 drop) would open the door to 96.03 (50% Fibo of the 2017-2018 drop) and finally 97.23 (55-day SMA). On the flip side, the next support is located at 93.48 (2020 low Jul.27) seconded by 93.19 (monthly low June 2018) and then 91.80 (monthly low May 18).
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD hovers around 0.6500 amid light trading, ahead of US GDP
AUD/USD is trading close to 0.6500 in Asian trading on Thursday, lacking a clear directional impetus amid an Anzac Day holiday in Australia. Meanwhile, traders stay cautious due ti risk-aversion and ahead of the key US Q1 GDP release.
USD/JPY finds its highest bids since 1990, near 155.50
USD/JPY keeps breaking into its highest chart territory since June of 1990 early Thursday, testing 155.50 for the first time in 34 years as the Japanese Yen remains vulnerable, despite looming Japanese intervention risks. Focus shifts to Thursday's US GDP report and the BoJ decision on Friday.
Gold price lacks firm intraday direction, holds steady above $2,300 ahead of US data
Gold price remains confined in a narrow band for the second straight day on Thursday. Reduced Fed rate cut bets and a positive risk tone cap the upside for the commodity. Traders now await key US macro data before positioning for the near-term trajectory.
Injective price weakness persists despite over 5.9 million INJ tokens burned
Injective price is trading with a bearish bias, stuck in the lower section of the market range. The bearish outlook abounds despite the network's deflationary efforts to pump the price. Coupled with broader market gloom, INJ token’s doomed days may not be over yet.
Meta Platforms Earnings: META sinks 10% on lower Q2 revenue guidance Premium
This must be "opposites" week. While Doppelganger Tesla rode horrible misses on Tuesday to a double-digit rally, Meta Platforms produced impressive beats above Wall Street consensus after the close on Wednesday, only to watch the share price collapse by nearly 10%.