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  • DXY keeps the rangebound theme unchanged near 98.30.
  • Trump said on Tuesday that a US-China trade deal is ‘close’.
  • US CPI, Powell’s testimony before Congress next of relevance.

The greenback, when tracked by the US Dollar Index (DXY), keeps navigating the upper end of the recent range around the 98.30 region.

US Dollar Index focused on data, trade, Fed

The index is alternating gains with losses so far this week, managing to keep the trade near recent tops at 98.40 although it seems bulls still need a stronger catalyst to impose their will.

News from the trade front noted President Trump hinted at the likeliness that the US and China could clinch a trade agreement soon at his speech at the Economic Club of New York on Tuesday. Trump, however, made no mention of lifting tariffs or the timing of a potential meeting with his Chinese peer Xi Jinping.

Moving forward, inflation figures for the month of October will be the salient release later in the NA session ahead of Chief Powell’s testimony before the Joint Economic Committee of the Congress. In addition, Minneapolis Fed N.Kashkari (2020 voter, dovish) will speak in Wisconsin.

What to look for around USD

The index has managed well to reverse some selling pressure in past sessions and it remains so far sidelined near weekly tops around the 98.40 region. In the meantime, headlines from the US-China trade war should remain ruling the global sentiment, while the attention has now shifted to Powell’s testimony before Congress and key inflation data out later today. On the broader view, the outlook on the greenback appears constructive on the back of the Fed’s renewed ‘wait-and-see’ mode vs. the dovish stance from its G10 peers, the dollar’s safe haven appeal and the status of ‘global reserve currency’.

US Dollar Index relevant levels

At the moment, the pair is gaining 0.01% at 98.33 and a break above 98.42 (monthly high Nov.12) would open the door to 99.25 (high Oct.8) and then 99.67 (2019 high Oct.1). On the flip side, immediate contention emerges at 97.97 (100-day SMA) seconded by 97.53 (200-day SMA) and finally 97.11 (monthly low Nov.1).