- DXY remains under pressure below the 92.00 mark.
- Pandemic concerns remain in the centre of the debate.
- No data releases in the US docket on Friday’s shortened session.
The greenback, in terms of the US Dollar Index (DXY), remains well under pressure and trades at shouting distance from the 2020 lows near 91.70.
US Dollar Index targets the YTD lows
The index remains on the way to close the month with important losses and opens the door to further decline in case the 2020 lows in the 91.75/70 band (September 1) are cleared.
In the meantime, the rapid pick-up in infected cases in past hours eclipsed the optimism coming from positive news regarding effective vaccines, although market participants continue to favour the risk complex in detriment of the safe haven space.
US markets will return to the normal activity following the Thanksgiving Day holiday, albeit in a shortened session. All the attention, however, is expected to gyrate around the “Black Friday” and the performance of retailers.
What to look for around USD
DXY remains on the defensive and does not rule out a visit to the 2020 lows near 91.70 in the short-term horizon. The better mood in the risk-associated space remains underpinned by a clearer US political scenario in combination with auspicious vaccine news and better growth prospects. Furthermore, hopes of extra fiscal stimulus have re-emerged and along with the “lower for longer” stance from the Federal Reserve is seen keeping the buck under extra pressure for the time being.
US Dollar Index relevant levels
At the moment, the index is retreating 0.12% at 91.88 and faces the next support at 91.84 (monthly low Nov.26) followed by 91.74 (2020 low Sep.1) and then 89.22 (monthly low Apr. 2018). On the other hand, a breakout of 93.20 (weekly high Nov.11) would open the door to 93.39 (100-day SMA) and finally 94.30 (monthly high Nov.4).
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