US Dollar Index recovery falters ahead of 97.20
- The index keeps the negative territory around the 97.00 area.
- US 10-year yields dropped to the vicinity of 3.01% post-ISM.
- US ISM Manufacturing surprised to the upside at 59.3.
The greenback is struggling to erase the daily losses and keeps hovering over the 97.00 handle when measured by the US Dollar Index (DXY).
US Dollar Index supported near 96.70
Notwithstanding the prevailing selling bias, the index managed to regain composure and stage a moderate rebound from daily lows near 96.70 to levels around/above the key 97.00 milestone.
It is worth recalling that the recently announced US-China truce has been taking a toll on the buck since early trade, although buyers appear to have emerged in the vicinity of 96.70.
In the data space, Markit’s Manufacturing PMI came in at 55.3 for the month of November, just a tad lower than forecasts. On a better tone, the ISM Manufacturing rose to 59.3 for the same period, also collaborating with the recovery in the Dollar. Regarding the latter, Senior Market Analyst at FXStreet Joseph Trevisani noted: “By size, manufacturing is a minor part of the US economy, maybe 15% . But by its importance as an indicator and the status of factory employment it carries weight. The recovery in November manufacturing PMI is a good sign for fourth quarter GDP”.
US Dollar Index relevant levels
As of writing the index is losing 0.25% at 96.95 and a break below 96.62 (low Nov.29) would open the door to 96.32 (low Nov.22) and finally 96.04 (low Nov.20). On the flip side, the next hurdle emerges at 97.53 (high Nov.28) seconded by 97.69 (2018 high Nov.12) and then 97.87 (61.8% Fibo retracement of the 2017-2018 drop).
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.
