US Dollar tumbles to lows near 89.40

  • The index drops sharply to the 89.40 region despite auspicious data.
  • US 10-year yields sidelined around tops in the 2.86% zone.
  • US headline Retail Sales expanded more than expected in March.

The US Dollar Index (DXY), which gauges the buck vs. a basket of its main rivals, has sharply broken below the daily sideline theme and is now challenging recent lows in the 89.40 region.

US Dollar weaker on data, focused on Fedspeak

The index accelerated the downside despite US headline Retail Sales expanded at a monthly 0.6% in March, beating prior surveys. In addition, Core Sales rose 0.2% MoM, coming in in line with forecasts.

Additional publications saw the manufacturing gauge from the Empire State at 15.60 for the current month, missing consensus and down from March’s 22.60.

The offered bias remains well and sound around the buck so far today, gaining unexpected traction in spite of the healthy results from the retail sector.

In the meantime, tensions in the Middle East, further sanctions against Russia and US-China trade conflict remain poised to drive the sentiment around the buck in the near term.

Further out in the data space, the NABH index is due seconded by TIC Flows, while speeches by Dallas Fed R.Kaplan (non voter, hawkish) and Atlanta Fed R.Bostic (voter, centrist) are also expected.

US Dollar relevant levels

As of writing the index is losing 0.40% at 89.44 facing the next support at 89.40 (low Apr.11) seconded by 88.94 (low Mar.27) and then 88.25 (2018 low Feb.16). On the other hand, a breakout of 89.95 (high Apr.12) would aim for 90.60 (high Apr.6) and finally 90.89 (38.2% Fibo of 95.15-88.25).

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