- The index meets selling orders and returns to sub-97.00 area.
- The NFIB index surprised to the downside in January at 101.2.
- Chief Powell, JOLTs Job Openings coming up in the calendar.
The greenback met a wave of selling orders in the area of 97.20, or 2019 peaks, sparking the current knee-jerk in the US Dollar Index (DXY) to the 97.00/96.90 band so far.
US Dollar Index lower on risk-on, looks to trade
Rising speculations of a potential US-China agreement or some kind of significant announcement following this week’s talks have been sustaining the renewed upbeat mood in the riskier assets and thus sponsoring the so far moderate correction lower in the buck from fresh YTD peaks.
Also sustaining the recovery in the global markets, US lawmakers have clinched an initial agreement on Monday. The deal, which still faces some opposition from conservatives and needs to be passed in Congress and signed by President Trump, should prevent another government shutdown, at least in the near to medium term.
In the US docket, the NFIB Small Business Optimism index came in at 101.2 in January, missing estimates and recording the lowest level in the Trump administration. Later, JOLTs Job Openings is due along with the API report and speeches by Fed’s Powell and KC Fed E.George.
What to look for around USD
US-China trade talks are expected to kick in later today against the backdrop of renewed hopes of a deal and/or an extension of the 90-day truce deadline. These hopes are now helping the sentiment in the riskier assets and somewhat undermining the ongoing rally in the buck. On another front, weakness in overseas economies (vs. solid US fundamentals) plus G10 central banks apparently entering a ‘wait-and-see’ mode have been sustaining the upbeat momentum in the greenback as of late, while there is still a high degree of scepticism regarding the likeliness that the Fed’s tightening cycle could end any time soon.
US Dollar Index relevant levels
At the moment, the pair is losing 0.19% at 96.89 facing immediate contention at 96.79 (23.6% Fibo of the September-December up move) followed by 96.42 (55-day SMA) and then 96.16 (21-day SMA). On the upside, a breakout of 97.20 (2019 high Feb.12) would aim for 97.71 (2018 high Dec.14) and finally 97.87 (monthly high Jun.20 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
AUD/USD stands firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday. The AUD/USD advance was sponsored by a United States report showing the economy is growing below estimates while inflation picked up. The pair traded at 0.6518.
EUR/USD mired near 1.0730 after choppy Thursday market session
EUR/USD whipsawed somewhat on Thursday, and the pair is heading into Friday's early session near 1.0730 after a back-and-forth session and complicated US data that vexed rate cut hopes.
Gold soars as US economic woes and inflation fears grip investors
Gold prices advanced modestly during Thursday’s North American session, gaining more than 0.5% following the release of crucial economic data from the United States. GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the US Fed could lower borrowing costs.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. The BoJ will announce its decision on Friday at around 3:00 GMT.