US Dollar Index: DXY looks to regain 103.00 as US Durable Goods Orders, CB Consumer Confidence loom

US Dollar Index (DXY) picks up bids to refresh its intraday high near 102.80 as it pares the previous day’s losses amid a sluggish Tuesday morning in Asia. In doing so, the greenback’s gauge versus the six major currencies portrays the market’s preference for the haven assets amid mixed concerns while also suggesting the cautious mood ahead of the key US data.

While portraying the mood, S&P500 Futures print mild gains despite the downbeat closing of the Wall Street benchmarks and the US Treasury bond yields. That said, the bond coupons are mostly sluggish of late.

Apart from the trader’s rush towards the US Dollar amid the market’s indecision, the previous day’s upbeat US data and optimism surrounding the Federal Reserve (Fed) also underpin the DXY’s run-up. On Monday, US Dallas Fed Manufacturing Business Index for June improved to -23.2 versus -26.5 expected and -29.1 previous readings. During the last week, the US Core inflation for May allowed Fed Chairman Jerome Powell to remain hawkish but the Purchasing Managers’ Indexes for June weren’t impressive enough. Even so, Federal Reserve Bank of San Francisco President Mary Daly signaled on Friday that two more interest rate increases this year would be a "very reasonable projection."

It’s worth noting that market fears emanating from Russia and China join broad pessimism about the concerns that the global economic recovery will fade to also allow the US Dollar Index to grind higher.

Looking ahead, the US Dollar Index traders should closely watch the US Durable Goods Orders for May, expected -1.0% versus 1.1% prior, as well as the US Conference Board’s (CB) Consumer Confidence data for June, expected to arrive at 103.90 versus 102.30 prior, for clear directions. Also important will be European Central Bank (ECB) President Christine Lagarde’s speech at the ECB Forum. Should the US data arrive as softer and ECB’s Lagarde manage to convince the policy hawks, the DXY may witness a pullback.

Technical analysis

A sustained break of a three-week-old descending resistance line, now support around 102.30, directs US Dollar Index (DXY) toward the 100-DMA hurdle surrounding 103.10.