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  • DXY retested the area of weekly highs near 98.30.
  • The dollar gained nearly 4% since Monday’s YTD lows.
  • US advanced U-Mich index came in at 95.9 in March.

The greenback, when tracked by the US Dollar Index (DXY), is extending the weekly recovery for yet another session and probes tops in the 98.30 area.

US Dollar Index capped by 98.30

The increased and renewed selling bias around the Japanese yen has been sustaining the inflows into the greenback and therefore pushing the index back above the 98.00 mark along with the rebound in yields of the US 10-year note to the vicinity of the 1.0% level.

Furthermore, the dollar has managed to advance nearly 4% from Monday’s new 2020 lows in the 94.60 zone to peaks near 98.30 recorded earlier in the session.

On Thursday, the Federal Reserve injected fresh cash into the system amidst rising speculations of a 100 bps interest rate cut at the March 17-18 meeting, all aimed to mitigate the impact of the COVID-19 on the US economy.

In the US calendar, Export Prices contracted 1.1% MoM during February and Import Prices went down by 0.5% inter-month. Additional data saw the advanced Consumer Sentiment coming in at 95.9 for the month of March, a tad above consensus and down from January’s 101.0.

US Dollar Index relevant levels

At the moment, the index is gaining 0.75% at 98.23 and a break above 98.31 (weekly high Mar.12) would open the door to 98.93 (high Aug.1 2019) and finally 99.37 (high Sep.3 2019). On the downside, the next support aligns at 96.03 (50% Fibo of the 2017-2018 drop) followed by 94.65 (2020 low Mar.9) and then 94.20 (38.2% Fibo of the 2017-2018 drop).


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