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  • US Dollar Index turns quiet after dropping below 97.
  • Spanish economy grew 1.9% annually in third quarter.
  • US economic docket features Goods Trade Balance and Pending Home Sales on Monday.

The USD selloff last week allowed the EUR/USD pair to gain traction and add nearly 100 pips. With the greenback starting the new week on the back foot, the pair climbed to its highest level since mid-August at 1.1211 and has gone into a consolidation phase. As of writing, the pair was moving sideways near 1.1200, adding 0.2% on a daily basis.

The only data from the euro area on Monday showed that the Spanish economy expanded by 1.9% on a yearly basis in the third quarter following the 2% growth recorded in the previous quarter and missed the market expectation of 2%. Nevertheless, the shared  currency largely ignored this reading.

US Dollar Index turns quiet below 97

On the other hand, the US Dollar Index, which tracks the greenback’s performance against a basket of six major currencies, extended the slide that started after Christmas break and fell to 96.73 earlier in the day. Ahead of the Wholesale Inventories, Goods Trade Balance, Pending Home Sales and Dallas Fed Manufacturing Index data from the US, the index is down 0.2% on the day at 96.82.

The European economic docket won’t be featuring any macroeconomic data releases on Tuesday and year-end flows could cause harp fluctuations.

Technical levels to watch for