• DXY moves higher following poor PMI data in the euro area.
  • US yields extend the weekly corrective downside on Thursday.
  • Weekly Claims, Flash PMIs, Powell’s testimony next on tap.

The greenback, when tracked by the US Dollar Index (DXY), regains the smile and advances to daily highs around 104.70 on Thursday.

US Dollar Index focused on data and Powell

The index so far reverses part of the recent weakness and manages to revisit the 104.70 region in the second half of the week.

Indeed, poor prints from flash PMIs in the central euro area for the month of June sparked a sell-off in the risk complex and lent legs to the buck amidst further retracement in the US yields across the curve.

Later in the NA session, usual Initial Claims are due seconded by advanced June PMIs and the weekly report on US crude oil inventories by the EIA. In addition, Chief Powell will testify again, this time before the House of Representatives.

What to look for around USD

The index seems to have embarked on a consolidation theme with the upper end limited around 105.00 for the time being.

The dollar, in the meantime, remains well supported by the Fed’s divergence vs. most of its G10 peers (especially the ECB) in combination with bouts of geopolitical effervescence, higher US yields and a potential “hard landing” of the US economy, all factors supportive of a stronger dollar in the next months.

Key events in the US this week: Initial Claims, Flash PMIs, Powell’s Semiannual Testimony (Thursday) – Final Consumer Sentiment (Friday).

Eminent issues on the back boiler: Hard, soft, softish landing of the US economy. Escalating geopolitical effervescence vs. Russia and China. Fed’s more aggressive rate path this year and 2023. US-China trade conflict. Future of Biden’s Build Back Better plan.

US Dollar Index relevant levels

Now, the index is gaining 0.39% at 104.59 and a break above 104.94 (weekly high June 22) would expose 105.78 (2022 high June 15) and then 107.31 (monthly high December 2002). On the downside, the next support aligns at 103.41 (weekly low June 16) seconded by 102.70 (55-day SMA) and finally 101.29 (monthly low May 30).


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.

Feed news Join Telegram

Recommended content

Recommended content

Editors’ Picks

EUR/USD remains in range near 1.0600 on Lagarde's speech

EUR/USD remains in range near 1.0600 on Lagarde's speech

EUR/USD is trading close to 1.0600, keeping its recent range on ECB President Christine Lagarde's remarks on Day 2 of the ECB Forum in Sintra. The US dollar struggles amid a positive shift in risk sentiment and firmer yields. US data awaited. 


GBP/USD bounces towards 1.2300 amid renewed USD selling

GBP/USD bounces towards 1.2300 amid renewed USD selling

GBP/USD is bouncing back towards 1.2300, capitalizing on the renewed selling in the US dollar across the board. The risk recovery is weighing on the dollar, despite the rebounding Treasury yields. Brexit and UK political woes remain a drag on the pound. US data eyed. 


Gold sticks to gains near $1,825, upside potential seems limited

Gold sticks to gains near $1,825, upside potential seems limited

Gold attracted some dip-buying on Tuesday and reversed a part of the overnight sharp retracement slide from the very important 200-day SMA. Gold held on to its modest gains through the early European session and was last seen trading above the $1,825 level.

Gold News

How to use the Fibonacci Retracement indicator to trade Bitcoin and Ethereum

How to use the Fibonacci Retracement indicator to trade Bitcoin and Ethereum

A brief technical and on-chain analysis on a few cryptos. FXStreet’s analysts evaluate where the hottest cryptos on the market could go next.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!