- The index consolidates around 97.60 amidst low volatility.
- US markets will be closed today due to Memorial day holiday.
- US GDP, PCE, Personal Income/Spending next of relevance this week.
Measured by the US Dollar Index (DXY), the greenback is looking for direction in the lower bound of the range near 97.60.
US Dollar Index flat, looks to trade, data
Poor prints in the US docket during the second half of last week added downside pressure to the buck following fresh 2019 highs in the boundaries of 98.40 and lent extra oxygen to the riskier assets.
In the meantime, the lack of fresh news around the US-China trade war could prompt investors to look for catalyst on the other side of the Atlantic in the wake of the EU parliamentary elections.
There will be no activity in the US calendar today due to the Memorial day holiday, while key data releases are coming later in the week: another revision of Q1 GDP, inflation tracked by the PCE, Personal Income/Spending, U-Mich index and Fedspeak.
What to look for around USD
Recent poor prints in the US calendar triggered new concerns over the likeliness of a technical recession in the US economy in the next months and somewhat spooked USD-bulls. Additionally, US-China trade negotiations remain mired in the mud for the time being, while investors’ focus has now shifted to the probable intervention in the Yuan by the Chinese government. On another direction, the FOMC minutes reinforced the ‘patient’ stance from the Federal Reserve and the ‘transitory’ lack of upside momentum in domestic inflation. In addition, the Committee ruled out rate cuts in the next months and left the door open for extra tightening if the economy evolves as planned. The positive outlook on the buck, in the meantime, stays unchanged and sustained by overseas weakness, its safe haven appeal, favourable yield spreads vs. the Fed’s G10 peers and the status of global reserve currency.
US Dollar Index relevant levels
At the moment, the pair is retreating 0.03% at 97.58 and a break below 97.55 (low May 27) would open the door for 97.27 (55-day SMA) and then 97.03 (low May 13). On the other hand, the next resistance emerges at 98.37 (2019 high May 23) seconded by 98.97 (78.6% Fibo of the 2017-2018 drop) and finally 99.89 (monthly high May 11 2017).
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
EUR/USD flirts with 1.0700 post-US PMIs
EUR/USD maintains its daily gains and climbs to fresh highs near the 1.0700 mark against the backdrop of the resumption of the selling pressure in the Greenback, in the wake of weaker-than-expected flash US PMIs for the month of April.
GBP/USD surpasses 1.2400 on further Dollar selling
Persistent bearish tone in the US Dollar lends support to the broad risk complex and bolsters the recovery in GBP/USD, which manages well to rise to fresh highs north of 1.2400 the figure post-US PMIs.
Gold trims losses on disappointing US PMIs
Gold (XAU/USD) reclaims part of the ground lost and pares initial losses on the back of further weakness in the Greenback following disheartening US PMIs prints.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
Germany’s economic come back
Germany is the sick man of Europe no more. Thanks to its service sector, it now appears that it will exit recession, and the economic future could be bright. The PMI data for April surprised on the upside for Germany, led by the service sector.