US Dollar Index drops to 2-month lows, near 93.80
- The index breaks below the key support at 94.00 the figure.
- Yields of the US 10-year reference climb to tops beyond 3.09%.
- Philly Fed manufacturing index came in above estimates at 22.9.
The selling pressure around the greenback is now picking up pace and is forcing the US Dollar Index (DXY) to recede to levels last seen in mid-July in the proximity of 93.80.
US Dollar Index offered as sentiment deteriorates
The index accelerated the leg lower after the mood in the risk-associated assets improved even more following auspicious Brexit headlines and some EUR-supportive comments from BuBa’s J.Weidmann (next ECB President?).
DXY quickly dropped to levels last seen in mid-July in the sub-94.00 zone, recording at the same time new 2-month lows and threatening the critical support at June’s low at 93.71, all amidst a broader selling picture that has been prevailing since mid-August.
In the data space, Initial Claims bettered estimates rising at a weekly 201K, taking the 4-Week Average to 205.75K from 208.00K. On a more relevant side, the Philly Fed manufacturing gauge came in at 22.9 for the current month, surpassing consensus and up from August’s 11.9.
US Dollar Index relevant levels
As of writing the index is losing 0.69% at 91.91 facing the next support at 93.83 (low Sep.20) seconded by 93.71 (monthly low Jul.9) and then 93.19 (monthly low Jun.14). On the flip side, a break above 94.91 (21-day SMA) would aim for 95.00 (high Sep.14) and finally 95.04 (55-day SMA).
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.
