US Dollar Index challenges 96.00, daily lows

• The index comes under further selling pressure and tests the 96.00 handle.
• Yields of the US 10-year note ease from tops beyond 3.17%.
• US Non-farm Payrolls for the month of October next of relevance.

The selling pressure around the greenback remains unabated in the second half of the week and is now forcing the US Dollar Index (DXY) to drop to the vicinity of the key support at 96.00 the figure.

US Dollar Index now focused on data

After a positive performance during the first half of the week, the index now plummeted to multi-day lows and threatens to break below the critical support at the 96.00 milestone.

The greenback gave away recent gains as concerns on the US-China trade front continued to fizzle out in past hours after the White House hinted at the likeliness that a trade deal with China remains well on the cards. It is worth mentioning that President Trump and China’s Xi Jinping are expected to meet at the G20 gathering in Argentina at the end of the month.

Furthermore, recent auspicious headlines from the Brexit negotiation have been also collaborating with the better risk-on sentiment in detriment of the buck, which remains on the defensive after clinching fresh YTD peaks near 97.20 on Wednesday.

Moving forward, the greenback will be in centre stage in light of the publication of October’s Non-farm Payrolls, expected at more than 190K jobs.

US Dollar Index relevant levels

As of writing the index is losing 0.22% at 96.10 and a breakdown of 96.04 (low Nov.2/50% Fibo retracement of the 2017-2018 drop) would open the door to 95.94 (21-day SMA) and finally 94.79 (low Oct.12). On the flip side, the next up barrier lines up at 96.46 (10-day SMA) seconded by 97.19 (2018 high Oct.31) and then 97.87 (61.8% Fibo of the 2017-2018 drop).