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  • The index stays below the 94.00 handle ahead of the opening bell in Europe.
  • US 10-year yields rebound to the 2.84% area following post-NFP lows.
  • Rising tensions in the US-China trade war are poised to dominate sentiment.

The greenback, in terms of the US Dollar Index (DXY), has started the week on the back footing and is now poking with session lows in the 93.90 region.

US Dollar looks to Trump, trade war

The index is down for the fourth session in a row on Monday as market participants continue to digest Friday’s release of US Non-farm Payrolls.

In fact, the greenback remains under pressure despite the creation of job in the US stays on track, although the unemployment rate ticked higher and inflation pressure via wages decelerated somewhat during last month.

Further out, yields in the US money market are bouncing off recent lows in the 2.80% neighbourhood in response to an escalation of the US-China trade war, with both countries imposing tariffs on goods worth $3.4 billion on each other.

No data releases scheduled for today in the US docket should leave the attention to trade war headlines, while investors will also be wary on increasing political effervescence in the Old Continent.

US Dollar relevant levels

As of writing the index is down 0.16% at 93.86 and a breakdown of 93.79 (55-day sma) would target 93.19 (low Jun.14) en route to 93.12 (38.2% Fibo of April-June up move). On the flip side, the next hurdle is located at 94.04 (23.6% Fibo of April-June up move) followed by 94.51 (10-day sma) and then 94.61 (21-day sma).