US Dollar Index regains the 96.00 handle and above ahead of data

The index extends the rally above the 96.00 mark.
US 10-year yields met some decent support near 2.68%.
US Trade Balance, Building Permits, Durable Goods Orders next on tap.

Pablo Piovano FXStreet

The upbeat tone surrounding the greenback remains well and sound on Wednesday and is motivating the US Dollar Index (DXY) to advance further north of 96.00 the figure.

US Dollar Index focused on data

The index is up for the fifth session in a row today, managing to not only retake the critical barrier at 96.00 the figure but also to advance to fresh multi-day peaks near 96.30.

Further selling bias around both the Sterling and the shared currency has propelled the buck earlier in the day, although some buyers turned up around peaks near 96.30.

On another front, nothing new from President Trump’s SOTU speech last night, where he once again reiterated his willingness to build the border wall and barely mentioned the US-China ongoing trade dispute.

Looking forward, Trade Balance figures are due next along with Durable Goods Orders, the EIA report and Building Permits.

What to look for around USD

The greenback appears to have left behind the recent dovish message from the FOMC at its last meeting, re-shifting their focus to upcoming data releases. However, investors are expected to remain vigilant on the new neutral stance from the Federal Reserve, as well as any indication of the timing of the balance sheet run-off. Back to the trade front, President Trump and China’s Xi Jinping will meet on February 27-28 in Da Nang (Vietnam) to resume talks, while speculations of some sort of agreement is expected to weigh down the buck.

US Dollar Index relevant levels

At the moment, the pair is up 0.09% at 96.16 and a breakout of 96.24 (high Feb.6) would open the door to 96.42 (55-day SMA) and finally 96.68 (high Jan.24). On the downside, immediate contention emerges at 95.89 (21-day SMA) followed by 95.37 (200-day SMA) and then 95.16 (low Jan.31).

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.

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