US Dollar Index tumbles to weekly lows near 99.80


  • DXY drops below 100.00 to print fresh weekly lows.
  • US Initial Claims rose nearly 3.3M million during last week.
  • US flash Q4 GDP came in at 2.1%, matching consensus.

The greenback, in terms of the US Dollar Index (DXY), is posting losses for yet another session on Thursday, this time breaking below the triple-digit support and testing the 99.80 area.

US Dollar Index offered post-data, extra stimulus

The index is extending the weekly pessimism for the third session in a row on Thursday, coming under extra selling pressure following the recently announced stimulus packages from the Fed (Tuesday) and the White House (earlier today), while comments by Chief Powell’s earlier today also hurt the mood surrounding the buck.

Releases in the US docket did not help the buck either, as there were no surprises after another estimate of Q4 GDP matched expectations and advanced readings showed the trade deficit is seen shrinking to $59.89 billion during February. However, Initial Claims surged to record tops after climbing to nearly 3.3M during last week, casting further shadows over the impact of the coronavirus on the US economy.

Earlier in the session, Chief J.Powell left the door open for extra easing in case the outlook deteriorates further, emphasizing the readiness of the Fed to step in if credit flows struggle.

What to look for around USD

DXY keeps correcting lower following another rejection of the 103.00 region, or 3-year highs, earlier in the week. Further stimulus measures announced by the Fed and the US government lifted spirits in the risk-associated space and put the buck under extra downside pressure. Last week’s sharp upside in the dollar has been sustained by the solid demand in response to funding concerns, while easing monetary conditions by central banks other than the Fed have been also collaborating with the upbeat sentiment around the greenback. In the meantime, developments from the coronavirus pandemic and the global response to fight its impacts are expected to keep driving the sentiment in the global markets.

US Dollar Index relevant levels

At the moment, the index is losing 1.10% at 99.82 and faces the next support at 98.48 (55-day SMA) seconded by 97.97 (200-day SMA) and then 97.87 (61.85 Fibo retracement of the 2017-2018 drop). On the flip side, a breakout of 102.99 (2020 high Mar.20) would open the door to 103.65 (monthly high December 2016) and finally 103.82 (monthly high January 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.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex News

Editors’ Picks

AUD/USD drops back towards 0.6200 on RBA's FSR

Australian dollar ran through fresh offers on the RBA’s Financial Stability Review (FSR), as it highlighted the elevated risks to the economy due to the coronavirus outbreak. AUD/USD drops sharply towards 0.6200, having faced rejection near 0.6250. 

AUD/USD News

USD/JPY holds in neutral territory awaiting Fed's Powell

USD/JPY has been holding in consolidation and ranged sideways between 108.60 and 109.10 overnight. Fed's Powell and US jobs will be the final scheduled catalysts for the holiday-shortened week.

USD/JPY News

WTI: On the front foot above weekly resistance-turned-support

WTI nears the weekly top after breaking the short-term resistance line, now support. A sustained run-up could aim to fill the March month’s gap. 50% Fibonacci retracement, 200-HMA restrict near-term declines.

Oil News

Gold is consolidated in the $1640s in wind-down markets ahead of Fed's Powell

The markets are quieter in Asia following a strong performance on Wall Street with US stocks bouncing back from the prior session's lows. Gold has moved into consolidation between $1,647.60 and $1,650.

Gold News

What to expect from OPEC and G20

Equities and currencies traded higher today after Dr. Fauci, the US’ Director of National Institute of Allergy and Infectious Diseases said there could be a COVID-19 turnaround next week.

Read more

Forex MAJORS

Cryptocurrencies

Signatures