US Dollar drops to 94.30 post-USD GDP, ADP

• The index remains entrenched into the negative territory around 94.30.
• The upside in US 10-year yields faltered just ahead of 2.90%.
• US ADP came in at 178K (vs. 186K exp.) and Q1 GDP at 2.2%.

The US Dollar Index (DXY), which gauges the buck vs. its main competitors, remains on the defensive in the 94.30/25 band on Wednesday, or daily lows.

US Dollar weaker post-data

The index has so far fully retraced Tuesday’s sharp advance to fresh tops just beyond 95.00 the figure, as jitters on Italian politics appear somewhat mitigated today (?), bolstering the better tone in the risk-associated complex and lifting EUR/USD around a big figure to the 1.1640 region.

In addition, releases in the US calendar did not help the buck either. In fact, the ADP report showed the US private sector added 176K jobs during last month, less than the 186K initially forecasted.

Furthermore from the data front saw another estimate of Q1 GDP now expecting the US economy to expand at an annualized 2.2% during the January-March period. On the more positive side, Goods Trade Balance deficit shrunk to $68.19 billion in April, less than estimated.

US Dollar relevant levels

As of writing the index is losing 0.56% at 94.33 and a breakdown of 94.01 (10-day sma) would target 93.64 (23.6% Fibo of the April-June up move) en route to 93.37 (21-day sma). On the upside, the next up barrier aligns at 95.01 (2018 high May 29) followed by 95.15 (monthly highs Oct/Nov. 2017) and finally 96.51 (high Jul.4 2017).