US Dollar Index rose to 2-day highs near 94.20 ahead of data

DXY starts the week on a positive note above 94.00.
US 10-year yields cling to gains around 1.60% on Monday.
Industrial Production, NAHB Index, Fedspeak come up next.

Pablo Piovano FXStreet

The US Dollar Index (DXY), which gauges the greenback vs. a bundle of its main competitors, begins Monday’s session on a positive footing around 94.20.

US Dollar Index looks to data, yields

The index regains composure and upside traction after three consecutive daily pullbacks, including the corrective downside from new 2021 highs past 94.50 recorded on October 12.

The move higher in the index comes in tandem with the recovery in US yields, where the front end of the curve flirts with the 0.42% level and the belly surpasses the 1.60% yardstick so far on Monday.

The dollar, in the meantime, appears well supported by solid prospects for a tapering announcement as early as at the November meeting, while Fed speakers have been also intensifying their support to this view particularly since the September FOMC event.

In the US data sphere, Industrial and Manufacturing Production figures are due later in the NA session seconded by Capacity Utilization, the NAHB Index and TIC Flows.

What to look for around USD

The index corrected lower following new 2021 highs past 94.50 on October 12, although the bearish move has so far met decent contention near 93.70. Supportive Fedspeak, an anticipated start of the tapering process, higher yields and the rising probability that high inflation could linger for longer continue to prop up the sentiment around the buck for the time being and keep sustaining the case for the resumption of the uptrend in DXY in the relatively short-term horizon.

Key events in the US this week: industrial Production, NAHB Index (Monday) – Building Permits, Housing Starts (Tuesday) – Initial Claims, Philly Fed Index, CB Leading Index, Existing Home Sales (Thursday) – Flash Manufacturing PMI (Friday).

Eminent issues on the back boiler: Persistent uncertainty around Biden’s multi-billion Build Back Better plan. US-China trade conflict under the Biden’s administration. Tapering speculation vs. economic recovery. Debt ceiling debate. Geopolitical risks stemming from Afghanistan.

US Dollar Index relevant levels

Now, the index is gaining 0.10% at 94.16 and a break above 94.56 (2021 high Oct.12) would open the door to 94.74 (monthly high Sep.25 2020) and then 94.76 (200-week SMA). On the flip side, the next down barrier emerges at 93.75 (weekly low October 14) followed by 93.67 (monthly low Oct.4) and finally 92.98 (weekly low Sep.23).

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.

GBP/USD remains offered; bears target 1.3600

GBP/USD now leaves behind part of its recent recovery and revisits the low 1.3600s at the beginning of the week. Indeed, Cable trades with a mild downward bias amid decent gains in the Greenback as investors remain wary of upcoming US data releases and the Jackson Hole event.

EUR/USD remains sidelined above 1.1650

EUR/USD trades on the defensive following the closing bell on Wall Street on Monday, hovering around the 1.1660 region and adding to Friday’s small decline. The pair’s pullback comes in response to an acceptable rebound in the US Dollar in a context of generalised caution ahead of key US data releases and Chair Warsh’s speech in Jackson Hole.

Gold advances to over three-month high as bulls look to reclaim $4,700

Gold climbs to a fresh high since mid-May, with bulls now eyeing $4,700 and extending the rally witnessed since the beginning of this month. The US Treasury's bond market intervention failure fuels concerns about fiscal sustainability and boosts demand for bullion as an alternative store of value. Moreover, the US Dollar struggles to attract any meaningful buyers, which, along with receding bets for an immediate Fed rate hike, continues to benefit the non-yielding yellow metal.

Ethereum: BitMine scoops 32K ETH, hints at further gains

Ethereum (ETH) treasury company BitMine Immersion Technologies (BMNR) expanded its digital asset holdings last week with another round of acquisitions. The firm purchased 32,447 ETH during the week, lifting its holdings to 5.847 million ETH. That represents its largest purchase since the first week of July.

Will Jackson Hole ignite Gold and Silver’s next explosive breakout?

The 2026 Jackson Hole Economic Policy Symposium arrives at a pivotal moment. The U.S economy faces record debt, elevated borrowing costs, a weaker dollar and renewed momentum across hard assets. For The Gold & Silver Club, the backdrop increasingly validates its early-year call: “2026 will be the Year of Hard Assets.”

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.