US Dollar pushes higher near 97.50

Pablo Piovano FXStreet

The US Dollar Index - which tracks the buck vs. its main competitors - keeps the upside intact today and is currently advancing to fresh highs in the mid-97.00s.

US Dollar in 3-month tops

The index met extra buying pressure on Tuesday, navigating the area of multi-month peaks around 97.50 and on its way to a potential test of July’s tops in the 97.60/65 band.

Rising speculations on the likeliness of a rate hike by the Federal Reserve at its December meeting keep sustaining the broad-based sentiment around the dollar. In fact, CME Group’s FedWatch tool now sees the probability of higher rates by year-end at above 63%.

In addition, US yields are navigating a ‘sea of green’, collaborating with the bid tone in the buck and thus limiting any attempt of recovery in the risk-associated universe.

On the data front, the Fed’s Labor Market Conditions Index has dropped to -2.2 for the month of September. Next on tap will be the speech by Minneapolis Fed N.Kashkari (2017 voter, neutral).

US Dollar relevant levels

The index is advancing 0.54% at 97.45 and a break above 97.62 (high Jul.25) would open the door to 98.59 (high Mar.3) and then 99.95 (high Jan.21). On the downside, the initial support aligns at 95.90 (200-day sma) ahead of 95.12 (support line off 2016 low) and finally 94.44 (low Sep.8).

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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