- DXY keeps business above the 100.00 mark.
- The global focus gyrates around the COVID-19.
- US Non-farm Payrolls next of relevance in the docket.
The greenback is looking to add to Thursday’s gains and stays bid above the key 100.00 barrier when tracked by the US Dollar Index (DXY).
US Dollar Index focused on data, coronavirus
The index is posting gains for the third session in a row on Friday, managing to extend the upside momentum beyond the key barrier at 100.00 the figure and record at the same time fresh multi-day highs.
In the meantime, the developments around the coronavirus and its impact on the economy remains in centre stage and gained extra attention on Thursday after the Initial Claims rose by a shocking 6.65 million during last week, showing that more than 10 million US citizens filed for unemployment benefits in the last couple of weeks.
By the same token, the dollar’s momentum is also underpinned by safe haven demand and increasing weakness in its rival currencies like the euro and the British pound.
Later in the session, the focus of attention will be on the monthly labour market report, where Non-farm Payrolls are expected to drop by around 100K jobs and the jobless rate is seen ticking higher to 3.8% in March. However, the significance of the report has dwindled as of late and would be largely anticipated by market participants, as these figures will not show the sharp deterioration of the labour market experienced since the second half of the month of March.
Still in the US, the key ISM Non-Manufacturing will also be in the limelight later in the NA session.
What to look for around USD
DXY has regained the upper hand so far this week after bottoming out in the 98.30 region in past sessions, managing to retake the key 100.00 barrier and above amidst firm safe haven demand. Indeed, market participants seem to prefer the dollar vs. other safe havens like the Japanese yen and the Swiss franc in a context of prevailing risk aversion, all in response to unabated concerns surrounding the coronavirus and its impact on the economy. Further support for the buck comes from its status of “global reserve currency” and store of value.
US Dollar Index relevant levels
At the moment, the index is gaining 0.12% at 100.23 and a breakout of 100.41 (weekly/monthly high Apr.2) would open the door to 100.49 (78.6% Fibo retracement of the 2017-2018 drop) and finally 102.99 (2020 high Mar.20). On the other hand, the next support emerges at 98.27 (weekly low Mar.27) seconded by 98.07 (200-day SMA) and then 97.87 (61.8% Fibo retracement of the 2017-2018 drop).
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 clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.