US Dollar Index recovers, still near 2017 lows

Matías Salord FXStreet

The US Dollar Index is about to end the day unchanged after being able to recover from 9-month lows. Earlier today it bottomed at 95.19, lowest since September. During the American session rebounded and found resistance at 95.65. Near the end of the session was hovering around 95.50.

The greenback posted mix results. It gained ground against the Swiss franc, the euro and the yen, but fell versus the pound and commodity currencies. The euro was among the worst performers. It stabilized, after a report from the Wall Street Journal mentioned that Mario Draghi could signal next month in Jackson Hole, that the Eurozone economy has reduced its depended on monetary stimulus.

Janet Yellen went again to Congress and offered no surprises. “I would love to see it”, Fed’s Chair said about Trump’s 3% growth goal. US economic data released today showed a 0.1% increase in June PPI and initial jobless claims dropped to 247K during the week ended July 7. On Friday CPI, retail sales and IP data are due.

Fed's Yellen speech : Fiscal policy uncertainty is currently quite high

DXY: Has it found a bottom?

The index today found support today around the 95.20 zone, like two weeks ago and also like yesterday. The trend still points clearly to the downside and momentum remains bearish.

“The Dollar Index has not met the minimum retracement objective (38.2%) of the rally since 2014. That level seen close to 94.30. Although there are some claims out there that the dollar is in a bear market, discipline would seem to require meeting retracement levels that are seen as a correction rather than a trend reversal”, said analysts from Brown Brothers Harriman.

They suggest two conditions that could signal a bottom in the DXY. “First, that the Dollar Index trades above 96.20, and second that interest rate differentials begin trending back in the US favor”, BBH analysts concluded.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

EUR/USD keeps the rangebound trade near 1.1850

EUR/USD is still under pressure, drifting back towards the 1.1850 area as Monday’s session draws to a close. The modest decline in spot comes as the US Dollar picks up a bit of support, while thin liquidity and muted volatility, thanks to the US market holiday, are exaggerating price swings and keeping trading conditions choppy.

GBP/USD trades with negative bias, eyes 1.3600 ahead of UK jobs data

The GBP/USD pair trades with a negative bias for the second straight day, though it lacks bearish conviction and holds above the 1.3600 mark through the Asian session on Tuesday. Traders now look forward to the release of the UK monthly jobs report, which will influence the British Pound and provide some impetus to the currency pair.

Gold sticks to a negative bias below $5,000; lacks bearish conviction

Gold remains depressed for the second consecutive day and trades below the $5,000 psychological mark during the Asian session on Tuesday, as a positive risk tone is seen undermining safe-haven assets. Meanwhile, bets for more interest rate cuts by the Fed keep a lid on the recent US Dollar bounce and act as a tailwind for the non-yielding bullion, warranting caution for bearish traders ahead of FOMC minutes on Wednesday.

AI Crypto Update: Bittensor eyes breakout as AI tokens falter

The artificial intelligence (AI) cryptocurrency segment is witnessing heightened volatility, with top tokens such as Near Protocol (NEAR) struggling to gain traction amid the persistent decline in January and February.

US CPI is cooling but what about inflation?

The January CPI data give the impression that the Federal Reserve is finally winning the war against inflation. Not only was the data cooler than expected, but it’s also beginning to edge close to the mystical 2 percent target. CBS News called it “the best inflation news we've had in months.”

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.