- The index keeps the positive note above the 95.00 handle.
- US 10-year yields stay sidelined around 2.96% so far.
- USD/CNY rebounds from lows and moves closer to 6.85.
The US Dollar Index (DXY), which gauges the buck vs. its main competitors, is prolonging the upside bias above 95.00 the figure, although some strong resistance emerged in the 95.30 area, or session peaks.
US Dollar looks to trade
The index is looking to consolidate the recent breakout of the key 95.00 barrier at the beginning of the week, adding to last week’s gains and reverting Friday’s pullback after US Non-farm Payrolls figures and PBoC headlines.
In fact, the US economy added 157K jobs during July, less than initially forecasted, while Average Hourly Earnings matched expectations and the unemployment rate ticked lower as expected. In addition, the PBoC announced it will impose a 20% reserve requirement in FX forwards, making it more expensive to short the Chinese currency.
In the meantime, and against the backdrop of an empty docket today, headlines from the US-China trade spat should dominate the sentiment in the global markets.
Still around the buck, speculative net longs climbed to the highest level since May 30 2017 in the week to July 31, as per the latest CFTC report.
US Dollar relevant levels
As of writing the index is gaining 0.03% at 95.24 and a break above 95.38 (high May 29) would target 95.53 (high Jun.28) en route to 95.65 (2018 high Jul.19). On the downside, immediate contention emerges at 94.98 (low Aug.3) seconded by 94.74 (10-day SMA) and finally 94.47 (55-day SMA).
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